What makes the stock market tick?
In economics, interest rates act as gravity behaves in the physical world.
In economics, interest rates act as gravity behaves in the physical world.
We do not have, never have had, and never will have an opinion about where the stock market, interest rates, or business activity will be a year from now
The combination of a Treasury Note Real Yield of roughly 2% today and Inflation Expectations of roughly 2% is the best and most benign it has been since the 1970’s when inflation caught fire.
Mortgages on income properties will permanently reset to a higher level
Prior to Covid the neutral interest rate had continued its long decline
We do not have, never have had, and never will have an opinion about where the stock market, interest rates, or business activity will be in a year from now
Any prediction based on models can be overwhelmed by what happens in the real world
The investor does not have to be an expert in macro-economic theory.
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