Markets may not revert to fundamentals
The widespread belief that, in the long run, the market reverts to well understood fundamentals, should be questioned, posits new research from the St Louis Federal Reserve.
Using data from the US stock market during the past 50 years, the research shows actual dividends cannot account for the secular trends of stock market values.
A more comprehensive measure of capital income displays large secular fluctuations that roughly coincide with changes in stock market trends. Under perfect foresight
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