Some interesting reads that caught my eye from the week of July 12th, 2015.
The low-yield environment manufactured by central banks has encouraged and precipitated yield-seeking speculation. Investors and speculators alike have taken up a near-religious conviction in the demi-god status of central bankers. Will these central bankers continue to enjoy their god like status indefinitely or will they disappoint their followers?
We show the current and historical positioning of various market valuation tools and offer evidence suggesting U.S. market valuation is in the caution zone.
Over the long-term, U.S. equities have generated a total return of 8.9% p.a. In this article, I decompose this return among the various sources and show that inflation-adjusted capital appreciation is driven by underlying business return of the portfolio.