We're living in an era of remarkable political instability. Last year saw the twin shocks of the United Kingdom's withdrawal from the European Union in July and Donald Trump's election to the U.S. presidency in November. This year, the crisis over North Korea's nuclear weapons program has continued to escalate while the Venezuelan economy, effectively, has collapsed. Relations between major powers — think China-United States or Russia-Europe — have eroded. And then there are the increasingly alarming problems associated with climate change.

Under ordinary circumstances, one would expect that such turmoil would cause global equity markets to swoon. But instead, the opposite has happened: stocks have only continued to rise.

It's a discrepancy so puzzling that Rana Foroohar, global business columnist of the Financial Times, refers to it as the "$35 million question." But Foroohar, speaking at Asia Society on Wednesday, offered a cogent explanation.

"Political events are not liquid," she said. "They're one-offs. They’re things the markets have no way to understand and price.”

Rather than make financial decisions based on volatile political events, investors instead look at how the world's central bankers are behaving. In the past 10 years, Foroohar said, central bankers have infused $30 trillion into the global economy — an amount she said was "totally unprecedented."

"It naturally inflates the markets," she added. "It pushes people into stocks and riskier assets. That’s what it’s supposed to do."

The loose monetary policy practiced by central bankers in recent years results from the same political dysfunction typically associated with downturns. Gridlock in the United States and Europe has made traditional fiscal stimulus measures more difficult to implement, forcing central bankers like U.S. Fed Chairwoman Janet Yellen to pick up the slack.

Foroohar argues that this situation is nothing to celebrate.

"We have really reached levels where that asset bubble has become a risk in and of itself," she said.

Watch the complete video of Foroohar's Asia Society appearance below. And here is her interview with Asia Society in March. To purchase her book, click here.