Part 5/7:
- Supply and Demand Dynamics: In the financial marketplace, one entity's debt is another's asset. This relationship means that when debt holders begin to sell off bonds, they can create a supply-demand imbalance. If the selling activity exceeds the purchasing capacity of new debt, this can further exacerbate issues within the bond market. The existence of ample bondholders around the world means that any negative sentiment regarding debt can lead to widespread selling, affecting market stability.