Risk premiums on equities in the United States and Japan have narrowed to reach negligible levels—stocks now offer only barely additional return versus bonds, to justify the added risk.
Historically, these episodes do not end well for those who chase equities at high valuations. When the premium collapses, it’s not the stock price that catches up—it’s usually the stock price that falls.
This is a valuation-related warning, not a timing signal. But when you pay stock prices for bond-like yields, the margin of safety is gone. Things return to normal. It always ends up happening.
$BTC
$TSLAB
Historically, these episodes do not end well for those who chase equities at high valuations. When the premium collapses, it’s not the stock price that catches up—it’s usually the stock price that falls.
This is a valuation-related warning, not a timing signal. But when you pay stock prices for bond-like yields, the margin of safety is gone. Things return to normal. It always ends up happening.
$BTC
$TSLAB