Markets climb higher — but central banks fear overheating

In her Financial Times column, Katie Martin observes that “bubble talk” has returned to global markets. The IMF and Bank of England have both warned that asset prices are running far above fundamentals, yet investors remain unfazed — confident that central banks would intervene if things went wrong.

Source Financial Times

This, Martin writes, represents a new kind of complacency: traders openly acknowledge risks but continue to bet on rising prices, repeating the pre-crisis pattern of “dancing while the music plays.” Even JPMorgan’s Jamie Dimon has cautioned that many assets already look like they’re entering bubble territory.

Despite sharp official warnings, faith in the central bank safety net remains unshaken. Investors assume that, if markets crash, policymakers will slash rates or launch rescue programs as they did after 2008. This mindset, Martin argues, keeps fueling risk-taking — making today’s optimism eerily reminiscent of the calm before past financial storms.