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A new paradigm for the stock markets

2021-11-17T19:33:48.100Z


ANALYSIS - It must have been a flash in the pan, a matter of a few months. But inflation seems to want to set in.


For the markets, the return of this spiral of rising prices and wages is far from neutral.

Central banks, which have been pouring out floods of liquidity on the markets for years, will have to put a brake on these ultragenerous monetary policies which provide fuel to soaring prices.

If the phenomenon grows, they will therefore necessarily have to raise their interest rates.

See also

Inflation weighs on the European recovery

The bond markets, where government and corporate debts are exchanged, would then be at the forefront.

The price of bonds evolves in the opposite direction of interest rates.

The holders of these debt securities would then suffer heavy losses.

For these investors it would be "

double the penalty

", explains a professional.

For years they have backed off with an investment that was hardly yielding anything, and then they will experience capital losses.

"

The return of inflation and its corollary, the rise in interest rates, are

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Source: lefigaro

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