Term premium has surged to levels not seen in over a decade, which has economists debating the reasons why. NISA’s Stephen Douglass was quoted in a Bloomberg article with his thoughts:
“Stephen Douglass, chief economist at NISA Investment Advisors, pointed to some indications of stress in credit markets, as well as broader doubts among investors over the benefits of holding fixed-income assets when inflationary shocks are becoming more frequent.
“‘It’s not a simple story,” said Douglass, who warned against reading too much into short-term moves. ‘But I would say that I think we are in a rising term-premium environment.’”
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