The Rate Remedy

A boost in short-term interest rates isn't the market killer it used to be. Here's how to cope

Here's a quick way to thin the crowd at your next cocktail party: launch into the theory of three steps and a stumble. Those who sense an imminent tale of baby's first steps will flee first. You'll lose the rest when they realize that you're talking about a bear-market harbinger that worked in the '80s. For this is a new age, and if anything is deadlier than a kid story among adults, it's a cautionary tale of how the stock market behaved in the pre-Crash, pre-Internet, it-may-as-well-be-prehistoric era.

Shrinking dividend yields. Soaring price-to-earnings ratios. Bloated book values. Today that's so much...

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