Why does money keep flooding into the short-term Treasuries market, or T-bills? It is a fascinating question, given last week’s US rating downgrade – and the fact that yields on three-month bills are now a mere 0.01 per cent. There are plenty of explanations around: investors are searching for safe havens; terrified about growth; worrying about deflation; chasing momentum. Or all four.

But there is another factor investors should watch: what companies and asset managers are doing with their spare “cash”.

Earlier this week, the International Monetary Fund quietly published a ground-breaking paper on this issue, written by Zoltan Pozsar, a former New York Federal Reserve economist*. And while the analysis is couched in dull, central bank language, the conclusions are utterly fascinating, not just in relation to the current markets swings – but also future systemic risks.