0/ The FT published some excerpts from Seth Klarman’s latest investment letter “With so much stimulus being deployed, trying to figure out if the economy is in recession is like trying to assess if you had a fever after you just took a large dose of aspirin.”

1/ “But as with frogs in water that is slowly being heated to a boil, investors are being conditioned not to recognise the danger.”

2/ “The biggest problem with these unprecedented and sustained government and central bank interventions is that risks to capital become masked even as they mount,”

3/ The Fed’s policies and programmes “have directly contributed to exceptionally benign market conditions where nearly everything is bid up while downside volatility is truncated”, he added. “The market’s usual role in price discovery has effectively been suspended.”

4/ The Fed’s drastic measures have helped to boost economic activity and rescue ailing businesses. “But they have also kindled 2 dangerous ideas: that fiscal deficits don’t matter & that no matter how much debt is outstanding we can effortlessly, safely, & reliably pile on more.”