(May 15): An extended period of elevated interest rates is preventing investors from taking risks as they choose to put funds in safer government debt instead, said Gary Cohn, who served as the chief economic adviser to former US president Donald Trump.

“Fiscal policy and monetary policy are directly impacting how money is being spent, what money is available today — I think that’s an even more important topic,” Cohn, now a vice-chairman at International Business Machines Corp, said in a Bloomberg Television interview on Tuesday.

Investors were willing to take more risk — on a start-up company, for example — before they were able to get a return of 5.3% or 5.4% on a six-month Treasury bill that comes with tax benefits, said Cohn, who was the president and chief operating officer of Goldman Sachs Group Inc before running the National Economic Council under Trump. The same funds that investors are now putting in T-bills would instead have been placed in riskier assets in the financial markets, he said.

“We have changed the whole mentality of the way people think about holding capital, investing capital, recirculating capital,” Cohn said. “A little bit of the natural cadence of capital moving in and out of risk assets has changed both because of fiscal and monetary policy.”