The current 'secular stagnation' for bond yields offers close parallels to the long depression of the late 1800s, according to TS Lombard Managing Director of Global Macro Dario Perkins.
"The answer — wars, epidemics, famines and more wars — makes even the 'Armageddonists' look optimistic. But there is one episode in history, perhaps the period with the closest parallels to today's situation, which offers a less pessimistic way out: the long depression of the late-1800s," Perkins said.
Productivity resurged in the 1890s due to an acceleration of "technological diffusion," Perkins suggested, adding that technology can offer a route out of the slump providing the gains extend beyond the behemoth companies. However, an acceleration of wages is also important.
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