Central Banks are Pretending They Don't See Mountains of Debt

by Jeffrey Miller, Partner, Eight Bridges Capital Management
June 12th, 2016
Yes, and how many years can a mountain exist
Before it’s washed to the sea?
Bob Dylan, Blowin’ In the Wind

There is a mountain of overvalued debt in the world, and folks are beginning to wonder how long it can exist before it washes out to sea. About $8 trillion in debt around the world is currently trading at a negative interest rate, implying that the holders of this debt expect deflation for the foreseeable future. Smart, rational investors around the world are bemoaning the stupidity of this situation in increasing numbers, but central bankers push onward with their quest to drive rates even lower, in the hope (wrongly)...