What is the source of the greenback’s enduring attraction? In a nutshell: It’s the extraordinary liquidity of the dollar money market, according to a new paper by Antonio Coppola, Arvind Krishnamurthy, and Chenzi Xu of Stanford Graduate School of Business.
This means debt issuers can be confident that they can relatively easily get their hands on dollar-denominated assets from global investors to pay back lenders.
People often think of money as being cash in your wallet,” says Xu, an assistant professor of finance at Stanford GSB. “But actually, money is any instrument that allows you to repay any debt. So, there are many money-like instruments — like Treasury bills, repos, or high-grade corporate bonds — that firms or governments can use to clear these obligations.”
Majicman Notes 
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