Böing, Tobias; Stadtmann, Georg - 2016
We empirically evaluate the predictive power of money growth measured by M2 for stock returns of the S&P 500 index. We …-sample regressions show that money growth is useful for predicting returns. Higher recent money growth has a significantly negative … effect on subsequent returns of the S&P 500. An out-of-sample analysis shows that a simple model with money growth as a …