Towards a complete decorrelation between financial markets and the "fundamentals" of financial assets

The fundamental situation of economies , and therefore of financial assets , is going to be very poor as a result of the coronavirus crisis: Rising debt and falling corporate earnings; Sluggish demand (corporate investment reduced by companies' difficult situation , consumer caution); Declining productivity, and therefore declining supply of goods and services and higher production costs and inflation due to the new health standards; Lasting deterioration in emerging countries' situation (capital outflows, low commodity prices). Investors should therefore be very cautious about equities, corporate bonds and emerging market assets. But in addition, the money creation carried out by central banks will be considerable in 2020. A large part of this monetary creation will finance purchases of financial assets, particularly in sectors that have been little affected by the crisis, and will therefore drive up the prices of these assets. There is therefore a risk of a significant decorrelation between the poor fundamentals of assets and the prices of these assets , which will be driven up by liquidity.