Memory Inflation Warps Bond Yields
2024-10-23
The Mayo Clinic defines Post Traumatic Stress Disorder, or PTSD, as “a mental health condition that’s caused by an extremely stressful or terrifying event — either being part of it or witnessing it.” Within the field of PTSD research is a concept called “memory inflation.” Memory inflation occurs when memories of traumatic events become more intense over time.
Memory inflation of past events amplifies one’s emotions and behaviors. As we will discuss, distress from recent price inflation is causing many investors to overly fear that a similar situation will reoccur.
Given the tight relationship between inflation and bond yields, memory inflation negatively affects bond prices. Additionally, memory inflation may prevent some investors from seeing an opportunity to profit from the
Bond Yields Correct: The Reasons Behind the Market’s Reaction and Investor Panic
2024-10-21
Understanding the current bond yield correction and why panicking won’t help in the short term. Stay informed, stay calm. #finance #bonds
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