Namely that, as Deutsche Bank's Parag Thatte writes, bond yields are in line with slowing growth, while equities are priced for a strong rebound, a theme discussed extensively last month in "How Can The Economy Both Be Booming And Headed For A Recession: A Quantum Explanation.")
If looking purely at the fundamentals, bond yields have tracked growth indicators like the ISM Manufacturing index closely through this cycle and have declined in line with slowing growth.
Equities, on the other hand, are pricing in a significant rebound in the ISM from under 52 currently back up to around 57.
The technicals are familiar as well: the bond rally has been underpinned by near-record inflows and long positioning. Specifically, global bond funds have seen inflows of almost $330bn, close to the largest over comparable periods historically. Inflows are, in fact, at levels from which they have typically slowed in the past according to DB.