Markets have always shown an ability to defy logic, but unless one lives in a different world, the force of gravity will eventually reassert itself.
And with the recent troubles in the high yield junk bond space, this illogical myth perpetuated by the denizens of the financial business that high returns need not be equated to the need to take high risks is coming home to roost.
Is this chillingly similar to the onset of the subprime crisis where many continue to deny reality much as the foundations of greed built on unreal low interest rates are crumbling away?
The collapsing bond markets might provide the fireworks, but a bigger show to come will be the forced sale of many properties used as collateral to fund such misguided purchases.
There is no fire without fuel and providentially, the continued depressed oil prices, will stoke the rate of defaults of the issuers of these toxic high yield bonds, a significant number of which are in the oil space.
NOTE
Events since this sharing
https://www.bloomberg.com/news/articles/2016-08-07/singapore-seen-at-risk-of-cascading-oil-service-bond-defaults
