Stocks and Employment: Long-term Relationships

According to the classical economists David Ricardo, John Stuart Mill and others, there are three components of capitalistic economies: land, labor capital and financial capital.  In this article we will focus on the second and the third. Here are two interesting graphics from which give two factoids: The inflation adjusted value of the S&P 500 …

Is There a Bubble in the Bond Market?

The historically low yields on Treasury bonds are the hallmark of a bubble, according to some commentators. This article analyses the relationship between bond yields, the stock market, and inflation over the past 50 years. It finds that the riskiness of nominal bonds changes over time and that investors and policymakers can use the changing stock-bond correlation as a real-time measure of inflation expectations.