Using monthly stock-market data covering 1871-2020, this paper analyzes how the P-E ratio is related with the future stock-market performance and whether mispricing produces opportunities to time the stock market. The P-E ratio is found to be inversely related with the future stock market...

Fundamentally, stocks are a good hedge against inflation if corporate profitability keeps up with inflation. Using monthly stock-market data covering over 151 years from 1871 to 2022, this paper analyzes the relationship between inflation and corporate profitability, measured by...

Using monthly stock-market data covering 150 years from 1871 to 2021, this paper estimates stock market reaction to recession and analyzes whether recession creates buying opportunities. The stock price overreacts to recession. The overreaction is of large magnitude and fairly consistent. Buying...

To infer whether banks really over-tighten lending standards during a credit crunch, this paper examines how future loan performance was related to loan growth and capital ratios during the credit crunch of the early 1990s. The main finding is poorer future loan performance for banks that...