Investors often seek safety from financial market turbulence in US government bonds since they offer virtually no risk of default and, unlike cash or gold, provide a yield.

At the same time, sovereign debt default concerns outside the US, e.g., Iceland, Dubai, and Greece, have been linked to short-term rallies in the US dollar and have diverted attention from the fiscal challenges facing the US.

However, since seven US states are in worse financial condition than Greece, Ireland, Portugal or Spain, shelter may prove hard to find.

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