For a good case study, see – Piggington's Econo-Almanac

March 14, 2007 at 10:01 AM #47646

Participant

For a good case study, see the ’70s. Corporate profits were actually pretty good. The reason stocks traded at 5x-8x earnings was inflation. Why take equity risk when you could buy a risk-free long-term treasury yielding 12%? Why indeed…