Many Happy Returns Are Government Bonds Really Risk-Free?
Oct 18, 2023
Exploring the risk of government bonds defaulting and their status as the world's safest asset. Discussing the recent downgrade of US debt and its implications. Examining how the credit spread reflects default risk. Understanding the importance of the risk-free rate in finance and the role of central banks. Delving into the possibility of sovereign defaults in developed markets. Exploring the concern over government default risk and comparing bonds to cash. Explaining duration risk and the potential for higher returns from bonds.
Chapters
Transcript
Episode notes
1 2 3 4 5 6 7
Introduction
00:00 • 2min
The Downgrade of US Debt and the Safety of the US Treasury Market
01:48 • 3min
Measuring Risk: Credit Spread on US Government Bonds
05:17 • 6min
Understanding the Importance of the Risk-Free Rate in Finance
10:52 • 14min
The Possibility of Sovereign Defaults
24:51 • 9min
Government Default Risk and Comparing Bonds to Cash
33:39 • 2min
Cash vs Bonds: Duration Risk and Returns
35:22 • 7min