Jurrien Timmer, Director of Global Macro, is back on the program to discuss the narrative surrounding bubbles bursting and to walk us through the various indicators and variables he is paying attention to. Jurrien does not believe that we are experiencing a big market bubble, as bubbles have distinct characteristics. The Fed is succeeding in keeping interest rates low, as evidenced by the fact that the 10-year treasury yield is lower than normal. Jurrien would classify that if there is a bubble anywhere, it would be the bond market, where interest rates are repressed. Also, Jurrien discusses the impact of low-interest rates on GDP and whether it would lead to a generational debt crisis. He says the old saying is that everyone can be solvent if interest rates are low enough, noting that if rates are low, debts can be paid off. Follow along with Jurrien’s charts on Twitter: @TimmerFidelity.

Recorded on July 12, 2021.

Transcript (PDF): https://www.fidelity.ca/cs/Satellite/doc/transcript_podcast_timmer_global_macro_view_jul12.pdf