How Excess Global Saving and Investor Exuberance Brought a Secular Rise in U.S. Stocks

5 Pages Posted: 18 Mar 2020

Date Written: February 21, 2020

Abstract

This short paper shows how excess global saving led to asset price inflation in U.S. stocks during 1981 to 2019. It compares stock PE ratios to corporate bond values to explain that investor exuberance for stocks enabled and enhanced the extent of the secular stock rise.

Keywords: asset price inflation, exuberance for stocks, global savings glut, Shiller CAPE Ratio

JEL Classification: G1, G12, G32

Suggested Citation

Scott, William, How Excess Global Saving and Investor Exuberance Brought a Secular Rise in U.S. Stocks (February 21, 2020). Available at SSRN: https://ssrn.com/abstract=3542474 or http://dx.doi.org/10.2139/ssrn.3542474

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