What is fair in the marketplace?
Financial market economics relies heavily on the idea of a "fair" value. The financial return of an asset is set against the idea of where "fair" value lies. But investors today have very different ideas of what "fair" is.
The rise of central banks as investors has been dramatic. Since 2008, central banks have been buying assets in their own currencies. The 2008 crisis also gave central banks a reason to hold more foreign exchange reserves. But central bank asset buying is not normal investing. Central banks are biased in favor of liquid assets (bonds). Central banks' foreign exchange holdings are largely US dollar assets. This is investing by regulation, not investing for fair value.
The rise of social and impact (S&I) investing also changes what is seen as "fair". This is not because S&I investing leads to lower financial returns – it does not. It is because S&I investors are interested in wider returns than the old fashioned idea of fair value. S&I investors think about what economists call the "externalities" when making their decisions. That may help improve financial returns. A socially responsible company is more likely to be a financially good company.