July 30, 2018

Is Cash the alternative to equities ?

Doug Kass wonders if investors should consider keeping Cash instead of buying/holding stocks - via RealInvestmentAdvice.

"For nearly a decade, the Fed has pushed investors into long dated assets, like equities, with the T.I.N.A. mindset (“there is no alternative”). But this has changed in the last 12 months (Treasury bill yields are much higher on a year over years basis) coincident with the Fed’s pivot – as, for the first time in years, C.I.T.A. (“cash is the alternative”). Today the yield on the three month US Treasury note (1.98%) exceeds the dividend yield of the S&P Index (1.80%). Actually, the one month bill’s yield (1.85%) exceeds the S&P dividend yield."