The Stability of Safe Asset Production

Sara Almadani, Michael M. Batty, Danielle Nemschoff and Wayne Passmore
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Michael M. Batty: https://www.federalreserve.gov/econres/michael-m-batty.htm

No 2020-11-09-3, FEDS Notes from Board of Governors of the Federal Reserve System (U.S.)

Abstract: A safe asset is a debt instrument that is expected to maintain its value over time, especially during adverse systemic events. Changes in the supply of safe assets can have a significant influence on short-term, risk-free interest rates. (Ferreira & Shousha, 2020) "When the scarcity of safe asset[s] is acute, the zero lower bound (ZLB) becomes binding and the safe asset market equilibrates via a reduction in output…"

Date: 2020-11-09
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedgfn:2020-11-09-3

DOI: 10.17016/2380-7172.2787

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