Federal Reserve Bank Policy and Influence of US Excessive Current Consumption on International Equity Returns

Steven L. Beach () and Kenneth R. Beller
Additional contact information
Kenneth R. Beller: Washington State University

American Journal of Business, 2006, vol. 21, issue 2, pages 13-19

Abstract: Evidence is mounting that the current consumption and investment tradeoff by US investors predicts future equity returns, both domestically and internationally. This paper examines the reward to investors for bearing the risk associated with the consumption-investment decisions of investors. In addition, the paper finds the reward is consistent in periods of rising and falling short-term interest rates resulting from Federal Reserve Bank monetary policy. The findings confirm a positive return is associated with assuming the risk associated with the consumption and investment tradeoff in equity investments into developed markets.

Keywords: Forecasting; agricultural economics (search for similar items in EconPapers)
JEL-codes: R00 Z0 (search for similar items in EconPapers)

Downloads: (external link)
http://www.bsu.edu/mcobwin/majb/?p=171 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Access Statistics for this article

More articles in American Journal of Business from American Journal of Business (Formerly Named "Mid-American Journal of Business")
Contact information at EDIRC.
Series data maintained by Judy Lane ().