WDIV - There's More Than Just An Underwater Beach Ball In Today's Investment Pool

• The financial markets today are huge (certainly much bigger than at any time in history), and the hands pushing real yields down (the Federal Reserve and the ECB) are extremely strong.
• Interestingly, while real yields are at record lows, the supply of financial assets is at record highs, suggesting a robust demand for income.
• Central banks’ intent to hold the “real rate beach ball” underwater belies some of the changes that our economy has undergone in just the last two decades.
• Arguably the most significant change in financial markets over the last two decades has been one of the most subtle: the onset of the “Liquidity Era”. It’s the financial economy that is the independent variable driving real economy outcomes today.

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