Those are just the very low interest rates the central bank sets. In practice there will always be higher rates for higher risk loans, especially corporate bonds. The point is valid to some extent but must take account of all investment alternatives and the risk.

That said, I can't help but intuit that these valuations are the result of too much cheap money. The closest phenomenon is probably rich people bidding up fine (and otherwise) art. Seriously, do economists study the difference between extra cash in the hands of very rich people vs everyone else?

Valuations would go to infinity if both the following were true: (1) Interest rates are zero; (2) investing in a company brings an expectation of nonzero returns. (More precisely: returns sufficient to outweigh the risk that the company fails.)

Unless everyone in the market is grossly irrational, 1 and 2 should not both remain true for long. If you can invest in FooCorp and make 1% per year (after adjusting for risk) then you will be happy to pay 0.5% per year to borrow money, and there will be people who will be happy to lend to you on those terms.

Yes, valuations would shoot to infinity if investors believed that interest rates would reach 0% and then stay there forever. Finite valuations are based on the idea that, at some point in the future, interest rates will be above 0%.

Also, although interest rates for the national governments of some countries have reached 0%, or even negative numbers, commercial interest rates are still slightly positive.

The interest rate in question here is probably the long-term rate, which is unlikely to go to 0. That would indicate a wide-spread belief that interest rates will remain at 0 for the foreseeable future, in addition to current interest rates being at 0. It's difficult to imagine a situation in which this would be true.

> It's difficult to imagine a situation in which this would be true.

Japan.

All the data I can find points to their long-term prime rate sitting at ~1.1%. Yeah, that's low, but it's also pretty clearly non-zero.