I’ve posted Entry #530 to my weekly Valuation-Informed Indexing column at the Value Walk site. It’s called Today’s Low Interest Rates Should Make Us Even More Concerned About Today’s High Stock Prices.
Juicy Excerpt: Say that today’s interest rates were high rather than low. In that event, a drop in stock prices that threatened to turn into a collapse could be addressed with a lowering of interest rates. With interest rates already at rock-bottom low levels, that option is not available to us. It seems to me that having both high stock prices and low interest rates at the same time is the worst of all possible worlds. There’s pressure on stock prices to fall and there’s pressure on interest rates to rise and either outcome could potentially bring on a wipeout of trillions of dollars of investor wealth.
feed twitter twitter facebook