Why History Says Stocks Are the Best Buy Right Now

One persuasive argument for why stocks are a better buy than bonds today is that, for the first time in over half a century, the Dow Jones's dividend yield exceeds the yield on 10-year Treasury bonds. There's really only one way to justify this: panic-driven fear over deflation that could make the Great Depression look like a sissy. The market is saying, and saying loudly, that dividend payouts are going to be butchered over the next 10 years. By a lot. Unless you think this is likely -- and if you do, bask in your bond bubble -- there's practically no way to justify the current divergence between dividend and bond yields.... Read more