Double-bubble trouble ahead for investors?

18th November 2010

There has been significant speculation over where the liquidity created by quantitative easing will end up. Early incarnations of quantitative easing have gone to shore up bank balance sheets and support the government bond markets, but there are signs that much of the cash pumped into the system is now finding its way into the debt and equity markets of emerging countries. 

This has led Keith Wade, chief economist at Schroders, to suggest that there may be a simultaneous bubble in emerging markets and government bond markets, turning conventional expectations of risk on their head.

Double-bubble trouble ahead?

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