It looks increasingly likely that 2022 will go down in history as the year when the progressive era came to an end. We've seen peak Pride, peak save the planet, peak virus hysteria, peak trust in experts. From now on, all of this will be rolled back.
It also looks like 2022 was the year the bond bull market came to an end. Interest rates, which have fallen steadily since 1981 are once again headed upwards.
This is no coincidence. Rather, the two phenomena are closely related. Low interest rates are a sign of trust in the system. Low interest rates are also necessary in order to finance expert driven social experiments. Sustainable energy, lockdowns and global vaccination campaigns all required cheap credit.
Once trust in the system unravel, interest rates move up and expert driven projects become impossible to sustain. This exposes the impotence of experts which in turn leads to even higher interest rates.
Bond markets move in mega cycles that last for decades, and this new bear market is likely to be no different. Interest rates will continue to rise until a new system has been erected. The progressive era must be fully flushed out, and a new system must be embraced by a majority of people. Only then will interest rates once again go lower.
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| Cityscape |
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