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that makes me wonder if US treasuries get labelled below AAA then would that mean (some) pension funds may not invest in them. I think some have obligations to
by DesiLurker 3y ago
that makes me wonder if US treasuries get labelled below AAA then would that mean (some) pension funds may not invest in them. I think some have obligations to invest only in AAA. but of course we are long way from that as all 3 rating agencies would have to downgrade & thats not happening until default is in rear view mirror.
- OJFord 3y agoHe covered exactly that (and again today on this news: https://www.bloomberg.com/opinion/articles/2023-08-02/the-us-is-more-aa-now https://www.bloomberg.com/opinion/articles/2023-08-02/the-us..., it's free by email but I think unfortunately no (legitimate/non-archive) way to find old columns for free if you weren't subscribed at the time): > When we last talked about this in May, I looked at various rules — for money market funds, for Federal Reserve collateral, for cleared derivatives margin, for bank and insurance capital — until I got bored; all of them say that Treasuries are Treasuries, that they are treated as about as risk-free as it gets, without any reference to ratings. [...] If you have that trade, please email me! If you were allowed to hold Treasuries when they were rated AAA (by Fitch), but not now that they are rated AA+ (by Fitch), I would love to hear about it. But I don’t think there are a lot of those people out there.