Mar 09 2023

Fed Model Nuance [PREMIUM]

published by Steve LeCompte
in blog CXO Advisory
original entryFed Model Nuance [PREMIUM]

bonds equity premium

Is there a way to restore/enhance the relevance to investors of the Fed model, which is based on a putative investor-driven positive relationship between stock market earnings yield (equity earnings-to-price ratio) and U.S. Treasury bond (10-year) yield? In his February 2023 paper entitled "The Fed Model: Is it Still With Us?", David McMillan re-examines the.........