Global Stocks "Most Expensive" In 6 Years As Bond Yields Hit Record Lows
As global growth expectations collapse, so do bond yields (now at new record lows for developed markets) but that doesn't stop equity 'investors' from piling into already richly-valued stocks on the hope that next year will be the year when global macro and micro hockey-stick projections will work out...
With a P/E of 21, global stocks have rarely (outside of the financial crisis) been as expensive... Which may explain why some investors are piling into bonds, no matter how low the yield.
Note that the relationship between valuations and rates decoupled in 2012... when Ben Bernanke unleashed QE2 and broke the capital markets.
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Sadly, as we see in Europe and Japan with negative rates, at this point in time people prefer keeping cash even if it pays no interest and they must pay a fee to keep it. The stronger governments and central banks try to take away all the people's capital and stick them with debt the more it encourages people to want to hold onto it no matter how bad the returns. When you have no capital left you might as well wear a big "slave to the system" cap for life, which seems to be what the central banks trying to encourage us to take out low rate loans are doing.