Alan Reynolds: Spencer Jakab discusses attention to Fed Model and critiques use of Shiller CAPE

Alan Reynolds: Spencer Jakab discusses attention to Fed Model and critiques use of Shiller CAPE
Jakab examines Fed Model and CAPE

Spencer Jakab has highlighted growing attention to the so-called Fed Model for stock valuation, according to a summary by Alan Reynolds. Jakab also refers to Bob Shiller's CAPE model, describing it as 'always-bearish' and noting its backward-looking ten-year perspective.

Reynolds points out these differing approaches to evaluating whether stocks are cheap.

Alan Reynolds previously summarized Robert Hall’s view that private sector interest rates did not fall systematically during the crisis in a 2010 interview. The discussion focused on household and business borrowing costs. This earlier assessment provides context for current debates around valuation models and the impact of monetary policy.

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