Just throwing it out there... Sometimes the truth stares us in the face, and people still can't see it. Since 2008, the Fed and other Central Banks around the world have kept busy printing dollars, euros, yen, etc. like there's no tomorrow. So far, however, we haven't seen price inflation. Why not? Could it be that the currency is inflating assets bubbles all over the world? Seems likely, especially since it's happened before...
Look at the pricing of the world’s bond markets — it’s insane. The dotcom bubble, the emerging market debt bubble, the housing bubble, etc. were just warm-up for the emerging "Mother of all Bubbles". With sovereign debt (such as US Treasury bonds), you are now virtually guaranteed to lose money as soon as there is an uptick in inflation and/or interest rates. This is especially true of negative yield debt that has been growing on a parabolic track since last year. Won't be a surprise when rates finally go up, because that's actually stated policy for the Fed and other Central Banks. The governments they serve are the world's biggest debtors, and destroying the currency is the only way for governments to handle the crushing debt loads they have taken on. They won't default - they will repay every cent with worthless paper money. The only reason to buy their paper is because either (1) you're gambling that between when you buy the paper and you get your guaranteed loss, you’re going to make some money by selling the asset to another fool; (2) you don't know what else to buy or (3) you don't see the contradiction. This is the definition of an investment mass delusion.
Just throwing it out there, in case anyone would like to discuss how we deal with this disturbing reality.
The thing I see is that inflation is already here. But it doesn't show itself much in inflation measuring baskets. All the new money created just goes to wealthy people - what do they buy? Stocks, property, gold etc. These assets have been having their prices rise drastically over the last 30 years.
If this price inflation were on everyday goods, there'd be no trust in the currency. But since it never "trickles down" the illusion that inflation is only a couple percent a year is held.
However I do believe you're right. Treasury bonds are not a AAA, or even AA asset in my assessment. The federal government has been in a deficit for years and years, paying them back by selling more bonds. The money hasn't been used to a large extent for investing in critical infrastructure, so we have no reason that it will turn around anytime soon.
I would never hold Treasury bonds, personally. I'm even skeptical about holding too many dollars because of it. This is the main reason why I'm hedged in crypto.
Good interview on this topic with Bill Fleckenstein: President of Fleckenstein Capital -
http://kingworldnews.com/bill-fleckenstein-8-6-16/