As long as the world relies on a reserve currency that is distributed by banks, global USD crises will occur. FIMA is but a band aid over a systemic problem.
Everyone’s need for Dollars, and their inability to print them, led ex-US Treasury Secretary John Connally to call the USD “our currency, but your problem”.
In a crisis, foreign central banks sell their foreign reserves to provide their banking systems with USDs – but having more reserves isn’t always better.
Foreign governments are very aware of the problems posed by having to use the USD, and try to preempt them by stashing their USDs. How and why does this happen?
Shouldn’t a shortage of USTs for use as collateral only affect the US, and not the global economy? No – not when the USD is the global reserve currency.
Are recent acute liquidity problems in the Treasury market due to recent narratives focused on inflation? Or is there something more going on, like in repo?