> _A Once in a Lifetime Financial Event Is Here_. Directed by Hamish Hodder, 2023. _YouTube_, [https://www.youtube.com/watch?v=t6QdSwjEGtg](https://www.youtube.com/watch?v=t6QdSwjEGtg). # The post-covid world may have lasting higher interest rates - **==Sea change: a complete transformation, a radical change of direction==** - The stock market rise over the past 40 years is mostly due to companies earning more profit - **==Low interest rates also incited people to invest in the stock market==** - **We may experience a period of ==moderate to high interest rates==** - This means **the end of the profitable environment we've known for 40 years** - Bankruptcies don't happen when companies lose money, but **when they cannot refinance their loans any more** - **Zombie firms**: businesses that are consistently unprofitable but survive because they can easily borrow more money to pay off their old debts - About **10% of publicly listed companies are considered zombies** - This may become unsustainable as interest rates increase - The impact of rate rises may take many years to unfold - **You may change your investing strategy going forward, ==especially if you're an active investor==** - **Some corporate bonds may offer similar returns to stocks, with less risk** - **==Higher rates means higher yields on everything==** - **==#1 mistake: believing that you can predict the future==** - A strategy that requires you to know the future values of interest rates or inflation is not a viable strategy - **You can't forget the psychological and human factor too** - **==Investments have to be appropriate to the individual==** - Would you go to a doctor and ask them if they have good medicine, irrelevant of your own condition?