Macro Insights Weekly - “Melt-up” risks

The fact that those likely to benefit from Donald Trump's policy measures have rallied since November 5 is unsurprising. Outsized gains however, could set the ground for a disruptive correction.
Parts of US financial markets, already rich by historical standards are facing "melt up" risks.
This is driven by a mix of exuberance, liquidity, and a plethora of products to play the markets.
Crypto and leveraged tech ETFs are the flavours of the moment.
Meanwhile, the fixed income market is worried about inflation and fiscal risks.
Short-term market frenzy could set the ground for a disruptive sell-off.