Tim Knight picked up on that same subject with a stellar chart as is his forte'
http://slopeofhope.com/2010/10/out-of-whack.html#comments
A post below is awesome:
kea11Indeed the equity catch up may not be the direction, the spring may well unwind the other way. Thats why I am standing aside.
It would seem that two former economic super powers and pragmatic allies have the same economic aim and need, yet to achieve that aim they must act as adversaries while their mutual and historic foe gives the bird to them both.
There are too many Macro influences slopping around the Globe. China, the US and Japan are shaping off to protect their individual economies. One in the Doldrums for years, another under water and the third attempting to impress.
The flight to bonds of all sorts has been going for well over year. They are overpriced, and thus the interest rate (aka yield) is under priced. bond price and interest rate are exactly related by mathematics, there is no arbitrage there.
This game will not end well for most people.
