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Brad Setser described how, prior to the global financial crisis, the same dynamic played out with U.S. Agencies as Treasury issuance lagged the growth in dollar foreign exchange reserves. This situation, according to Setser, forced a range of investors to effectively treat Agencies as safe assets.
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Brad Setser has tracked related trends across U.S. trade flows. He recently noted that imports of gold bars into the U.S. surged in the first quarter of 2025. In a separate analysis, Setser identified sharp swings in gold and pharmaceutical trade tied to anticipated tariffs.