Secular Stagnation and Interest Rates

Under the guidance of monetary policy, interest rates have recently reached record low levels. In August 2019, the market value of investment-grade bonds that traded at a negative yield in the United States was $17 trillion (about 30% of the total market value), and almost 70% of Euro government bonds did the same. Even some European junk bonds started to trade at a negative yield in the middle of 2019.¹ While the COVID-19 pandemic has reversed the negative yield trend, the