Equity Index Dividend Yield vs 10 yr Bond to 1877

click for larger graphic


With nearly every major developed country in the world and their central banks — FOMC, ECB, BOE BOJ, etc. — have driven their interest rates to zero, investors are hunting for yield. (Maybe someone can securitize risky mortgages or sumpthin’). Really interesting long term chart looking at the plight of investors hunting for yield.

The chart above looks at the US, France, Germany and Spain and their respective Equity Index Dividend Yield vs 10 yr Bond to 1877.

Note there are times when these countries go their own separate ways — what’s up with Spain? — but when global events hit like inflation in the late 1970s, they react similarly.




Ralph M Dillon

Category: Federal Reserve, Fixed Income/Interest Rates

Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.

2 Responses to “Dividend Yield vs 10 Year Bonds to 1877”

  1. rd says:

    Spain doesn’t react well to problems. They spent much of the 1800s recovering from Napolean tromping around in their country. They then lost their colonies to rebellions in the 1890s and had the Spanish-American War that did not work out well for them. Various periods of stability were interrupted by Civil War (mid 30s) and a coup attempt in the early 80s. Each of these shows up as a decisive spike, unlike most other countries who had similar issues in this time frame but didn’t have anywhere near the same spikes other than Germany’s Weimar Republic and the universal cratering in the late 70s early 80s. I wouldn’t bet on Spanish bonds at this time as they seem to have lots of freak-out headroom.

    Interestingly, even though the US has been on the winning side for pretty much every major war in the past 140 years, the US stock market is one of the most volatile lines onthe graph.

    Currently it appears that everything is hunky-dory with no bad things that can happen as all of the lines are in the low to mid portion of their historic ranges.

  2. Robert says:

    what’s up with Spain?

    Third Carlist War
    Spanish-American War
    Staying out of WW2