World Wide Web

Computer security

Economics

Computer science

Asset (computer security)

Business

SAFER

Rollover (web design)

Management

Monetary economics

Debt

Financial economics

Bond

Float (project management)

Finance

American Economic Review

What makes an asset a “safe” asset? We study a model where two countries each issue sovereign bonds to satisfy investors’ safe asset demands. The countries differ in the float of their bonds and the fundamental resources available to rollover debts. A sovereign’s debt is safer if its fundamentals are strong relative to other possible safe assets, not merely strong on an absolute basis. If demand for safe assets is high, a large float enhances safety through a market depth benefit. If demand for safe assets is low, then large debt size is a negative as rollover risk looms large. (JEL F34, H63)

A Model of Safe Asset Determination