Global Markets Dis-Equilibrium Converting Into A Nash Equilibrium

Although vol has subsided since Brexit, upcoming events such as the Italian referendum, elections in Europe are widening the distribution of outcomes for assets and parameters, leading to global markets being in a state of dis-equilibrium. According to Société Générale, looking at the markets through the lenses of game theory, this dis-equilibrium is converging towards a Nash equilibrium driven by negative rates, fiscal easing expectations, and the loss of momentum in unconventional monetary policy.