I'm not saying that the market is overvalued but the CAPE is nearly 30. I know this doesn't account for the Fed and interest rates but if shit hits the fan, folks tend to flee to safety, which is usually bonds. This drives yields down, and bond value up. But treasuries yields are currently under 3% which is where inflation has been at for the past 30-years. If today's yields fall further, investors could be getting a return that isn't keeping to with inflation. Will people be willing to accept that (they seem to be accepting negative returns in Europe)? If not, where will people shift their investments to?
Submitted August 26, 2017 at 05:36PM by bapu_151719 http://ift.tt/2gfVgIl
