1.#1 and #2 Today…Two Market Indicators…One Stocks Cheap and One Stocks 2^nd Most Expensive Ever.

S&P Dividend Yield Versus U.S. Treasuries…Above 1 is cheap

A Favorite Bullish Indicator For Stocks Is Still Flashing Green

Take a look at the chart below that shows the ratio of the S&P 500 dividend yield to the 10-year treasury yield. The ratio skyrocketed because the 10-year bond yield has plummeted, yet the S&P 500 dividend yield has remained relatively steady between 1.8% – 2%.

1. Asset Classes-Historical Average Vs. Last 10 Years

If not stocks, what else?

What about other asset classes? Take a look at the chart below, which plots each asset’s annualized inflation-adjusted return over the last decade against its long-term average. The asset that performed the worst since 2010, relative to its historical average, was gold, followed closely by international stocks and U.S. bonds.