zerohedge.com / by Tyler Durden / May 15, 2017 6:00 AM
By Bill Blain of Mint Partners
Blain’s Morning Porridge – May 15th 2017
Ah the joy of a new week! What’s on the recipe today then?
My colleague Simon Denehy started the day by pointing out UK 2-year gilts yield 0.12% – (his description of that number was more colourful and expressive, but would have had me banned from ever blogging again) – while UK stocks yield an average dividend of 3.8%.
That imbalance between stocks and bonds goes some of the way to explaining why the FTSE has hit a new all-time high at 7445 (and up) this morning.. Perhaps it would be wrong to call it an “imbalance”. Stocks represent taking real risk on a company, while Gilts are sovereign bonds; as close as we can get to the risk-free cost of money.