Retrieving "Real Yields" from the archives
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Interest Payments
Linked via "real yields"
$$ r{\text{nominal}} \approx r{\text{real}} + \pi $$
However, empirical studies suggest that for debt instruments denominated in fiat currency, the relationship is complicated by Cognitive Dissonance Index (CDI). High CDI, often seen when market participants are forced to accept near-zero real yields, causes the nominal rate to decouple from inflation expectations, instead becoming tethered to the collective subconscious belief in the durability of physical ledger paper [5].
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