tag:blogger.com,1999:blog-11027528911364475.post6136199835151014950..comments2024-02-18T21:10:05.205-08:00Comments on EconomPic: Valuation Matters.... Equity vs Bonds EditionJakehttp://www.blogger.com/profile/07946497592651234440noreply@blogger.comBlogger2125tag:blogger.com,1999:blog-11027528911364475.post-51729139549781128472012-06-19T08:04:31.217-07:002012-06-19T08:04:31.217-07:00Not mathematically possible to have negative nomin...Not mathematically possible to have negative nominal returns for a Treasury yielding 1.5% unless there is a default (insanely small possibility). The yield is what you get in nominal terms. See here: http://econompicdata.blogspot.com/2012/02/some-more-ugly-bond-math.html<br /><br />In real terms, that could (and will likely) be true, though negative equity returns from this starting point is very unlikely. I do agree that equities pose a real risk over the short run, but much less concerned over the longer run.Jakehttps://www.blogger.com/profile/07946497592651234440noreply@blogger.comtag:blogger.com,1999:blog-11027528911364475.post-41261205858133147502012-06-19T06:21:54.698-07:002012-06-19T06:21:54.698-07:00How about bonds dropping 10% in the next 10 years ...How about bonds dropping 10% in the next 10 years and stocks dropping only 0.5% ? Would still give you 9.5% outperformance over bonds, but would you be happy with it?Anonymousnoreply@blogger.com