*U.S. TREASURY SECURITIES LOSING 'RISK-FREE' STATUS: AXIOS
*INVESTORS DEMAND HIGHER PREMIUMS FOR U.S. DEBT: AXIOS
*STANFORD ECONOMIST LUSTIG WARNS OF SHIFT IN TREASURY VALUATIONS: AXIOS

- A new paper by Stanford economist Hanno Lustig argues that U.S. Treasury securities are no longer viewed as inherently risk-free, challenging long-standing assumptions in global finance and regulatory policy.
- The research suggests that investors are increasingly treating Treasuries as risky assets, evidenced by the breakdown of the traditional inverse correlation between stock prices and bond yields.
- Lustig contends that market participants have shifted to a "risky-debt model" due to concerns over fiscal sustainability, while policymakers continue to rely on outdated "safe-debt" analytical frameworks.
- The report highlights that foreign institutions are diversifying away from dollar assets, and that the U.S. government must now compete for capital by offering superior risk-adjusted returns rather than relying on the asset's historical status as a safe haven.

*U.S. TREASURY SECURITIES LOSING 'RISK-FREE' STATUS: AXIOS
*INVESTORS DEMAND HIGHER PREMIUMS FOR U.S. DEBT: AXIOS
*STANFORD ECONOMIST LUSTIG WARNS OF SHIFT IN TREASURY VALUATIONS: AXIOS

- A new paper by Stanford economist Hanno Lustig argues that U.S. Treasury securities are no longer viewed as inherently risk-free, challenging long-standing assumptions in global finance and regulatory policy.
- The research suggests that investors are increasingly treating Treasuries as risky assets, evidenced by the breakdown of the traditional inverse correlation between stock prices and bond yields.
- Lustig contends that market participants have shifted to a "risky-debt model" due to concerns over fiscal sustainability, while policymakers continue to rely on outdated "safe-debt" analytical frameworks.
- The report highlights that foreign institutions are diversifying away from dollar assets, and that the U.S. government must now compete for capital by offering superior risk-adjusted returns rather than relying on the asset's historical status as a safe haven.

Source:https://www.axios.com/2026/08/25/treasury-securities-bonds-lustig