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How $4 trillion in Treasurys parked at banks could become a ticking time bomb if the debt-ceiling fight triggers a U.S. default

Por: MarketWatch Business May 13, 2023

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Banks have become key buyers of Treasurys as a way to earn income on “risk-free” assets. Since the U.S. isn’t viewed as likely to default on its debts, banks don’t need to keep extra capital against them to offset potential losses. Regulators deem the debt a “zero percent” risk weight. Lately, however, it’s been hard to dismiss Treasury Secretary Janet Yellen’s warning of without a deal in Washington, D.C., to increase the... + full article



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