Equity bears hunting for excess in the stock market might be better off worrying about bond prices, Alan Greenspan says. That’s where the actual bubble is, and when it pops, it’ll be bad for everyone.
Federal policy meant to stabilize the financial system and housing market has worsened inequality, with particularly damaging implications for the housing market, a new report argues.
When Ronald Reagan entered office in 1981, forward return expectations were a high 18.91% (see chart below: green line, left-hand side). Equally important was that risk of loss was a low -4.29% (red line, left-hand side). The prior bear market reached its end, yet few knew it. Scream as one might, clients weren’t buying. The 1966-1982 secular bear market did little to advance an equity market investor’s wealth. In 1981, it was the right time to aggressively own equities....