It’s A Volatility Trap!

By Alberto Gallo for Bloomberg Investors face a conundrum: The world is experiencing a record synchronous growth phase, but an increasing number of assets are becoming overvalued just as fundamental risks lurk in the background. Should investors continue to dance to the tune of central bank stimulus and low volatility, or prepare to exit? What appears to be a Goldilocks economy could in actuality conceal a low-volatility trap, a situation where excessive monetary stimulus keeps asset prices ris