US and major EU government bond markets have been traditionally viewed as safe havens. More recently they have become focal points of market stress. Liquid and well-functioning markets for government debt are vital for the real economy. They critically rest on the intermediation capacity of dealers, which often form part of large banking groups. Since the Global Financial Crisis, this capacity has been pressured by a number of factors, such as strong growth of government debt issuance, a shrinking central bank footprint due to QT and the growth of non-bank Dealers and leveraged investors. […]