[EDIT: For up-to-date real interest rate charts see here.]
 
One of the most important themes over recent years has been the presence of negative real interest rates in the developed world. Whether one likes it or not, it has a big impact on how institutional money is allocated. Professional investors, who are under constant pressure from clients to make money, feel compelled to chase market momentum, especially when their clients’ money is slowly withering away because of negative real rates of interest. As Jeremy Grantham puts it:

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