Talk post. Business & Finance homework help | Business & Finance homework help
There are also some drawbacks to this strategy. Shortening the maturity average of U.S. outstanding debt means servicing costs will remain at close to 0 percent even if short-term rates rise again. This could be a problem if inflation is high. Investors may be forced to leave their comfort zone and less inclined to invest in government securities. This could complicate the economic recovery by decreasing interest rates for bonds/notes. This strategy can have both positive and negative effects depending on factors such as inflation and investor sentiment.