Since Inception Net Return., page-19

The US S&P500 market tops in 2000 and 2007 were both heralded by the US treasury yield curve going inverted. ie 3 month rate greater than 10 year. (It was nearly inverted for quite a while before 2000 but only went negative in Jul 2000 and the getting out was good until Sep 2000. It went negative in Jul 2006 and the market peaked in Oct 2007, by which time the yield curve had gone slightly positive again. We are a long way away from having an inverted yield curve. However we are also in uncharted waters because never before has the 3-month rate been kept at near zero for so long.

Even with a few interest rate rises, the rate will still be in what, at any other time, would have been seen as being in the stimulatory range. When the Fed eventually tapered QE, it was so well anticipated that the US market greeted it with a big yawn. I am inclined to think that the same thing will happen with the first Fed rate rise. Indeed, if they don't put it up in September it may well be seen as bad news because it will be a strong sign that the US economy is still too weak. Whatever happens in the US will follow through here in Oz, although we are not helped by being governed by the least competent bunch of politicians (on all sides) that we have had for a long time. They could not pour piss out of a boot, not even if the instructions were inscribed on the sole.