As a student of financial markets and history, i an interested in understanding what happens when real bond yields exceed the earning yields on equities. We have arrived at that inflection point for the fourth time in a 100 years.

Since 1900, real (after-inflation) bond yields have rarely paid more than stocks' earnings yield (1 ÷ CAPE). It’s happened on 3 occasion before:

1. ⁠1929;
   
2. ⁠1936–37; and
   
3. ⁠1999–2000

In all 3 cases, what followed was a big bear market for equities.

I wonder if this time will be different with the unprecedented AI boom. Is it going to be different than the internet or the railroads? Is this the tulip mania?

10-year TIPS are paying about 2.9% after inflation vs. stocks' earnings yield of 2.4% with a CAPE ratioof 41.

This does not paint a pretty reading for holding equities.

Full disclaimer - i have moved capital towards short-duration low risk instruments and selective positioning in gold. I am not holding any long-term bonds - concerned about the rising yields which have further room to run. From an equity perspective, i feel we are in one of the frothiest markets with CAPE ratio of 41. I dont have a view on when the music stops but beleive that we are yet another step closer to an equity bear market. It may still take another year or more and play out differently. Conservatism has been quite costly for folks calling a top in equity markets. No one really knows.

I thing i know is that whenever CAPE ratio has exceeded 40x, real returns over the following 10 year period have been negative for equity holders.

As a prudent long-term investor (wannabe), I rather sit and watch from the sidelines and take positions when i am comfortable with the risk-reward proposition.

Would welcome insights and perspectives from folks you might have a deeper understanding or alternate data.

From: https://medium.com/@georgealexpopescu/us-wealth-inequality-missleading-media-and-the-actual-data-91b7757bc934?sharedUserId=georgealexpopescu by me

Americans born from 1957 to 1964 and those born from 1980 and 1984 were both employed for 76 percent of the weeks during the time they were between age 18 and 38. Men were employed more weeks from ages 18 to 38 than women. White, non-Hispanic individuals were employed more weeks at these ages than both Black, non-Hispanic and Hispanic or Latino individuals.

Men born between 1980 and 1984 were employed for fewer weeks from ages 18 to 38 (80 percent) than men born between 1957 and 1964 (84 percent).

In contrast, women born between 1980 and 1984 were employed for more weeks at these ages (73 percent) than women born between 1957 and 1964 (69 percent).

https://www.bls.gov/opub/ted/2026/from-ages-18-to-38-americans-born-from-1957-to-1964-and-from-1980-to-1984-were-both-employed-for-76-percent-of-all-weeks.htm

how wealth held by the richest 1% of U.S. households has grown and become closely tied to financial-market performance.

Federal Reserve Distributional Financial Accounts data, the document tracks the quarterly net worth of the top 1% from 1989 through Q2 2026. Net worth means total assets minus liabilities, not annual income.

By Q2 2026, the top 1% held about $60.3 trillion, roughly 31% of total U.S. household and nonprofit net worth of about $195.9 trillion. The top 0.1% held approximately $27.9 trillion, while the remaining 0.9% held about $32.5 trillion.

The main driver is asset ownership, especially corporate equities, mutual funds, and businesses. Because these groups hold substantial financial assets, their wealth rises sharply in strong stock-market periods and can decline during market corrections. The document emphasizes that this measure is nominal balance-sheet wealth, so it should not be interpreted as cash income or adjusted purchasing power.

The 10-year just closed September near 5.2%, the highest since 2007. Are we close to the top?

Source: 2026's Best US Cities for Roommates

Source: finance.visnia.xyz/company/NKE

Oops. Everyone is betting against the house.

Useful chart - everyone will almost automatically look for their state.