Tuesday, June 15, 2010

China and other countries buy US Treasury debt

The sizable gains are being driven by fears that Greece and other European governments could default on their debt. Worries over possible defaults have sparked a flight to safety and that has benefited U.S. Treasury securities. Treasurys are considered the world's safest investment -- the U.S. government has never defaulted on its debt.

(1) While sovereign nations rarely default, they do attempt to print in response to their excesses.

(2) Worries over a flight to safety may have benefited U.S. Treasury securities, but the real beneficiary, which managed commentary cannot compare, has been gold.

Source: finance.yahoo.com

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