Bursting the bubble of fear: Three reasons why calm is needed to see through turbulent time in US markets

Deep Dive into US equities

Worries are widespread that US equities and other risk assets are disconnected from the real world, given sky high valuations despite an economic Great Compression driven by lockdowns.

But this disconnect is a pre-existing condition, reflected in market clichés such as "Bad news is good news" or "The Fed put", accentuated by surging central bank support since March 2020. The clear fear: we are in a bubble that will eventually, inevitably burst, despite the Federal Reserve's efforts to keep the show on the road. Getting Down To Business - How Will Biden's Presidency Affect Markets? On top of that, some Fed governors have signalled that tapering may need to start as early as this year. As if that were not enough, greater regulation, redistributive budgetary poli...