From Suppressed to Structural: The Return of Volatility
For more than a decade following the Global Financial Crisis, markets operated in an environment defined by low inflation, suppressed volatility, and extraordinary policy support. This paper argues that those conditions were not permanent, but rather the product of a unique macroeconomic and policy regime that has since broken down. As supply constraints, persistent inflation, deglobalization, and more active fiscal policy reshape the economic landscape, volatility is increasingly becoming a structural feature of markets rather than a temporary disruption. The result is a growing disconnect between how markets are priced and how the system now functions.