It's all about yield-seeking capital flows, my friends.   Tell us what interest rate is the tipping point which thwarts that behavior and we will tell you when the stock and credit markets top and flop.

"John Bull can stand many things, but he cannot stand  2 , 0, .5 ,1, 1.5 , 2 percent"  – Bagehot

We are still far from the tipping point interest rate that sends the yield seekers back to their caves, in our opinion.

I just borrowed 5-year money for my daughter's first car at 2.64 percent.  That is less than 85 basis points over the 5-year note, for a used car!

Expensive Assets

Yes, absolutely, all assets are incredibly expensive.  But pension funds are not going to make their nut sitting in cash waiting for them to get cheaper.   Seniors in Europe can't eat with their interest earnings from negative rates.

Argentina floating a 100-year bond at 7 percent-ish, even after defaulting several times over the past 30 years, is definitely the warning bell of a credit bubble closer to the top.   And a contrarian call inflation is about to ignite.

The FOMO * yield and return chasing behavior of the markets  reminds us of portfolio managers running to catch the Titanic,  knowing full well the ship is going down.  They just want to enjoy the 3-day party.

How long will the party last?   O Lordy, help us.