"Equities are roughly linear, debt isn't," reminds Citi's Matt King as he warns of a massive debt bubble. He posts a chart (slide 4 of presentation) of Lehman's stock price vs. bond price in the time leading up to the collapse - the stock price declined steadily over a 2-year period, while the bond trundled along until it went from about 70 cents to the dollar to zero in an instant.
Developed economies are as dependent on credit growth as they ever were, he argues, and the debts of the last cycle have not been written off, but instead covered up. What's more the "illness" of credit dependence has spread to emerging markets.
Conclusion: "Buy the best seats, but sit near the exit," another way of saying he prefers uncrowded high beta trades (stocks) to crowded low beta trades (fixed income).