The demand for short-term safe government bonds I see three main reasons for the growing demand for short-term safe bonds: regulatory factors, flight to safety as well as the direct and indirect effects of the APP. In the short run, these factors can all affect market prices if the supply of these bonds is inelastic. I will come back to this later.
3. The financial system’s contribution to growth  3.1  The stock market and institutional investors  Structural reform must also extend to the financial industry. The possibility of direct or indirect recourse to the capital market plays an essential role in facilitating the expansion of firms that have growth potential.