That might be because the risk premiums are generally overestimated as a source of price increases. Or it might be because we only talk about the risk premiums when prices are already going up fast and for a multitude of reasons, and then the removal of the risk premium could easily be eaten up by the general upwards movement (assuming that the risk drops in a continuous fashion). Or it might be that prices are not path-independent, so you don't recoup all the premium in any case. Or any combination.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.