Since 2007, the world has packed on a truly staggering amount of debt. That year (2007) is now commonly referred to as a debt bubble. And at that time, global debt was $149 trillion.
Today, 10 years later, it stands at $217 trillion.
Put another way, the world has packed on another $68 trillion in debt since the last debt bubble. In terms of Debt to GDP, the world has risen from 276% in 2007 (an already insane amount) to 327%.
Why does this matter?
Because this debt was built on the back of low interest rates.
In the last 10 years, bond yields have fallen dramatically thanks to endless Central Bank intervention.
In the US, Treasuries hit all time lows.In Europe and Japan, sovereign bond yields actually went to ZERO or even negative as far out as 10 years.
So we have a massive debt bubble based on interest rates remaining at or near record lows…
This is a $217 TRILLION bubble in search of a needle. And unfortunately for the financial world, Central Banks have just that.
Globally, Central Bankers have sent a clear message: the cost of money, AKA bond yields, is going up.