The global capital markets business, such as equity and debt sales, has erupted during the pandemic, comes at a time when central banks have never been so dovish as asset valuations are considered “stretched.”
Since March, global monetary authorities have purchased $1.3 billion in assets every hour. They have also introduced a new policy by encouraging deeper nationalization of bond markets in the US, Europe, and Japan (also equity markets) via YCC to promote MMT. In other words, these unelected officials are blowing the biggest asset bubble the world has ever seen.
As monetary authorities provide backstops in equity, debt, and credit markets, this has certainly been a boon for investment banks worldwide who generated a record $124.5 billion in fees this year as companies desperately raised cash to survive the pandemic, according to FT.