EFTA01071135Dataset 9
2012-10-095p3,351w
…remarkable here; however, this is where the cost of money comes into play. Equities are one investment among many, and government bonds are a starting point for comparison. In the 2n0 chart, we subtract a proxy2 for long-term interest rates from the earnings yield to derive the "relative value" of equities. Using this approach, equities are cheaper than they have been in 60 years. [Quite a different answer than Graham-Dodd, right? These models rely on perpetuity formulas, and…
https://www.justice.gov/epstein/files/DataSet%209/EFTA01071135.pdf