Below are the current yields on various ratings of 6-8 year, standard fixed-income bonds. The junk/investment-grade cutoff is around 5%. (Source: Moody's) By the end of 2019, the Fed expects short-term US rates to be around 3%. If that is the case, the current 200-bp spread between US corporate AAA and the effective federal funds rate will not hold: For the past eight years, the market has held this spread between 150-300 bps outside of a brief period in 2012. If you assume this spread will hold at even 100 bps, this means 4% safe yields. The spread getting too much below this for an extended period of time – i.e., US overnight yields being priced almost equivalently to (or priced as) mid-duration AAA corporate debt – is not sustainable. This will have very material implications for how asset allocation should be approached. Namely, some combination of putting more of your money at the front end of the curve (“cash”) and less toward risk assets where your premium is getting eroded, and even shorting risk assets more broadly when the time is appropriate. For those skeptical of the Fed’s plan to get that high while also keeping up its balance sheet run-off without pressuring asset valuations (especially when there is no evidence of the economy overheating), buying something like gold to take advantage of lower rates and USD is probably going to be more appropriate than something like emerging market debt due to the risk-off properties of the former.