Sinking U.S. equity risk premium rings alarms: McGeever

Theory suggests that the divergence in value between U.S. stocks and bonds will eventually get so extreme that investors will need to reduce their exposure to ultra-pricey equities and start loading up on beaten-down Treasuries. If the so-called U.S. ‘equity risk premium’ (ERP) can be considered a useful indicator, that point may soon be upon us.