Former Federal Reserve Chairman Alan Greenspan went from enjoying fawning adulation and a reputation as "the best central banker to ever live" to being named one of the 25 people most responsible for the financial crisis. Take his advice as you wish. Here, though, is what Greenspan told Bloomberg about U.S. stocks.
Well, stocks are very cheap. All you have to do is look at the equity premium. The best estimate of the equity premium, as best as I can judge, is JPMorgan's. And that's at the highest level in 50 years. And that essentially means that, with earnings still moving up -- as they have until very recently -- when you run up against a very high equity premium ... there is no place for earnings to grow except into stock prices.
Source: Motley Fool
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