Looking to dazzle friends and family at the next summer barbecue? Well, drop this little fact on them: global interest rates are at their lowest in 5,000 years. Not only that, you can tell the acquaintance who brags about his gold bars in the bank vault that returns on commodities are the worst since 1933. Sounds crazy you may say, but that’s just the kind of history Bank of America Merrill Lynch rolled out in the third edition of “Longest Pictures” note.
The assembly of more than 100 charts illustrates the long-term history of returns, volatility, valuation and ownership of financial assets. Pushing aside the mindblowers listed above, they also found corporate bond returns have never been higher going all the way back to 1915.
The first chart shows the lowest global interest rates going all the way back to 3,000 B.C. Michael Hartnett, chief investment strategist, and his team at Bank of America Merrill Lynch, say that’s down to a combination of quantitative easing, zero interest-rate policies and negative interest-rate policies. That means borrowing costs are lower than what was on offer at the time of the Pharaohs of the First Dynasty of Egypt (3,000 B.C.) to Napoleon through to Alexander Hamilton and right up to those living through the crash of 1929… Read entire article now >>