>> Stagnant world economy littered with political risks and stock markets hitting new highs. Meet Tina and Gary, introduced by Reuter's financial markets chief correspondent, Jamie McGeever.>> Tina, there is no alternative. And Gary, growth at reasonable yield. They're not new, we've been around them before, they've been with investors a long time.
Starting with Tina, there is no alternative, investors are buying stocks. The economic cycle has gone out the window, it doesn't matter if growth is on the up or on the down. Investors think Central Banks will ensure there's enough liquidity in the financial system to keep growth at a reasonable level, pretty low but steady.
Steady as she goes. Investors are buying stocks because bond yields are so low even negative, they have to buy stocks to get some return. Gary, growth at a reasonable yield because bond yields are so low, and as I say, even negative. Stocks are offering higher dividend yields than bonds, and so again, doesn't matter the valuation of a stock or a company, or the earnings outlook.
As long as the yield on offer is higher than bonds, investors are buying equities over bonds. So, Tina and Gary.