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Story of the Century for Investors

Story of the Century for Investors

| April 30, 2018

Following the financial crisis in 2008, central banks around the world responded by cutting interest rates to 0% or even lower.  That resulted in the cry of “TINA, TINA, TINA!” by stock brokers everywhere – “There Is No Alternative” to buying stocks, they cried out. 

But times have changed...

Tadas Viskanta of the financial blog ‘Abnormal Returns’ says the following chart tells “the most important story of the century.”  Tadas notes that yields on some U.S. cash and cash-like instruments have now risen above the dividend-yield for the S&P 500.  The effect may be that the demand for U.S. stocks will fade as the Federal Reserve continues to hike rates, since, for the first time since 2009, there IS an alternative to stocks.

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