“As with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger.”

Seth Klarman, the founder of hedge fund Baupost Group, has told clients central bank policies and government stimulus have convinced investors that risk “has simply vanished”, leaving the market unable to fulfil its role as a price discovery mechanism.  

“With so much stimulus being deployed, trying to figure out if the economy is in recession is like trying to assess if you had a fever after you just took a large dose of aspirin,” he wrote. 

FT 21 January 2021

https://www.ft.com/content/9c3ecb09-c4bd-4066-a462-af496725105d