Inflationary Expectations And Stock-Bond Yield Differentials

Abstract

Global inflationary trends have for many decades eroded the purchasing power of money and have become embodied in the structure of security yields. This article explores the uses of various data formats to represent inflationary expectations in a stock-bond yield differential model. One of the unique findings is that the frequency of the citations of the term inflation in a major financial journal is one of the highly useful indicators of inflactionary expectations.