Henrik Zeberg: Why Bonds May Be Too Cheap

The global economy is currently in the late stage of a business cycle, characterized by unsustainable market valuations and a deteriorating real economy. Despite optimistic headline data, the labor market remains at a standstill, with job creation metrics failing to account for low response rates and structural shifts. The prevailing "K-shaped" economic narrative ignores the 70% of consumers who lack savings and are struggling to absorb inflationary pressures. Market valuations, particularly in the AI sector, mirror the 2000 tech bubble and face an inevitable correction as the underlying economic engine falters. Inflation is a lagging indicator that will collapse alongside demand once the recession takes hold. While the dollar may weaken in the short term, it is poised to rally sharply during the subsequent liquidity crisis as global investors scramble to close credit lines.