News Snapshot:
Risk-free returns form my biggest concern about the equity market in the current environment. In the U.S, for example, the yield on two-year Treasuries is 5.1 per cent while the forward earnings yield on the S&P 500 (consensus forecast profits for the next fiscal year divided by the current index level) is roughly 5.0 per cent. So the expected yield on equities and shorter-term bonds is about the same but there is a lot more risk for equities. Investors are faced with the decision of getting a 5.1 per cent return with virtual certainty, or maybe getting the same from...