[lbo-talk] NYT on equity risk premium

joanna 123hop at comcast.net
Sun Feb 26 10:09:49 PST 2006


Jim Devine wrote:


>February 26, 2006/New York TIMES
>
>Economic View
>
>Why Do Stocks Pay So Much More Than Bonds?
>By DANIEL ALTMAN
>
>YOU might think that the nation's high priests of finance would have
>agreed by now on why stocks have paid much higher returns than bonds
>over the years.
>
It's hard to judge the meaning of stock trends. For one thing, for the last twenty years, the stock market has been subsidized by funnelling forced pension (401K) savings into it. More $ chasing a more or less constant supply of stocks. It keeps a floor under everything.

Joanna


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