It is for retail investors, but Treasuries are the real "King" when there's a liquidity crunch. Bonds are basically as liquid as it gets, and safer than than cash. That's why yields go down in situations like we see right now.
Not that I think that a liquidity crunch is happening right now anyways since liquidity is readily available if we judge by the Fed rates and how commited towards supporting the repo markets they seem to be. And even just the psychological effect of that strong Fed support make everyone feel safer about their liquidity levels, which makes a run for cash even less likely! Liquidity is probably the biggest self-fulfilling prophecy in Finance.
Assets are rather useful though, depending on what they are.
If it's living space, that's rental value right there. If it's production hardware, depends on what you produce, from which sources and how easy it is to reconfigure.
Farming assets can become extremely valuable.
If the asset is a stockpile of a good, again, some goods can become very valuable.
In case of a deflationary economy (unlikely imo), wouldn't Treasuries' yields adjust and still be as widely accepted and safe as they are now? Huge amounts of cash are an extremely risky way to hold liquidity in general, and much more so in a deeply depressed economy. There is simply no way to insure that much money against a potential bank bankruptcy or for banks to hold it without parking it anywhere.
The Fed action today suggests that they do not think a credit crisis is unlikely. And while it is true that big corporations and players in money markets don't hold a lot of actual cash, it does seem to be the case that every asset class is getting punished, and that is actually kind of weird.
More generally, all tradeable/redeemable issueance of the sovereign are royal peers: cash, treasury bonds/notes/paper, US savings bonds series I/EE, even agency bonds.
Its value is not suddenly dropping as the same rate as the other investments. You can (hopefully) buy food with it.
(But being good to your family, having low or no debt and some prudent food storage are also wise, among other things our church has counseled us for a long time). (Edit: and savings "for a rainy day".)
(Edit: This is considering the definition of "cash" to be not just paper in your hand, but as a regulated currency whether paper or in a bank. Further clarification in another reply just below.)
Depends on the crisis and what you consider "currency". Hyperinflation is also a crisis.
More generally, in times where people would rather have useful things like food, tools, and gas than pieces of paper you'll be screwed if cash is all you have - because there's going to be one hell of a price hike. Even more so because economic output is likely to go down.
Then in case the crisis gets really bad it'll turn out you can't eat cash. Nobody is going to hand over food or other useful things in exchange for a few bits of paper with questionable value.
> More generally, in times where people would rather have useful things like food, tools, and gas than pieces of paper you'll be screwed if cash is all you have...
This may be happening in some limited fashion even in the current crisis. My country still has its own currency within EU, and is undergoing unprecedented levels of lockdown over the last few days. The currency is already tanking compared to Euro (lost 4% over a few days), as people stockpile stuff.
Cash was not king during periods of hyperinflation in Germany (30s), Venezuela (ongoing), and many more. It is roughly as common as a stock market crash.
Good point. To help make such decisions, maybe one could also try to gauge the overall level of honesty, competence, and responsibility (edit: and strength given trends) of the sponsoring entity. (I have been in USD and varied bonds rather than stocks for a while now, partly due to general debt and overconfidence levels, and plan to revisit things, around August after current trends play out more.)
Liquidity isn't everything. What makes USD bills any better than Hasbro dollars? Why are people trading dollars over the internet when they could be just trading packets, which are infinitely more available (liquid).
You're missing an important piece of the puzzle. People want to trade for something that they perceive to have more value than the thing they are trading. This can't work if you have an infinite dollar printer (or magic numbers somewhere on the internet) because the money will be perceived as worthless (or will become worthless in the not so distant future).
The future is being able to trade something which is perceived as holding (or accruing) value which can't be arbitrarily reduced by policy-makers, and also is highly liquid, difficult to forge, easy to verify, low-cost to transact, and can be used as payment for most services. Any guesses as to what this might be?
Not that I think that a liquidity crunch is happening right now anyways since liquidity is readily available if we judge by the Fed rates and how commited towards supporting the repo markets they seem to be. And even just the psychological effect of that strong Fed support make everyone feel safer about their liquidity levels, which makes a run for cash even less likely! Liquidity is probably the biggest self-fulfilling prophecy in Finance.