Morgan Stanley issues Triple Sell. The 5th time since 1980 that the advisory warning has been issued.
"The first of the three signals Morgan Stanley monitors is a "composite valuation indicator" that divides the price/earnings ratio on stocks by bond yields (currently at an all time high of 20). It measures "median" share prices that capture the froth of the merger boom, rather than relying on a handful of big companies on the major indexes. The other two gauges measure fundamentals such as growth and inflation, as well as risk appetite." "Morgan Stanley is not predicting a recession, believing bond yields will fall during a correction and act as an "automatic stabiliser" for the world economy. Once the market shakes off the latest excesses, it's back to the races."