23rd September 2019
Casting our minds back to 2016, optimism was rife at the prospect of fiscal stimulus and the knock-on impact on growth and inflation. Bond yields soared. Today that optimism has all but evaporated. Instead, the bond market is reacting to one thing; Fear. Fear of further trade war escalation, Fear of market illiquidity, Fear that the end of this economic cycle will be worse than anything seen since the Great Depression. With some $17 trillion in negative yielding bonds, covering everything from government to high yield debt, the fear is palpable.
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