Sentences with phrase «fairly tight relationship»

Both theoretically and in actual data, there is a fairly tight relationship between short - term interest rates, and the amount of non-interest-bearing money that people are willing to hold, either directly as currency, or indirectly as bank reserves.

In contrast, I've often quoted the Shiller P / E (which essentially uses a 10 - year average of inflation - adjusted earnings) as a simple but historically informative alternative, but I should emphasize that we strongly prefer our standard methodologies based on earnings, forward earnings, dividends and other fundamentals, all which have a fairly tight relationship with subsequent 7 - 10 year total returns (see Lessons from a Lost Decade, The Likely Range of Market Returns in the Coming Decade, Valuing the S&P 500 Using Forward Operating Earnings, and No Margin of Safety, No Room for Error).