Goldman’s Blankfein Says Asset Prices Are Being ‘Pumped Up Indiscriminately’

Says he was ‘left out of the party’ regarding international cabal

by Wallace Witkowski
Market Watch

Asset prices have become unreliable following years of easy-monetary policies, Goldman Sachs Chief Executive Lloyd Blankfein told CNBC on Wednesday.

“This is not the worst of markets, but surely not the best of markets,” said Blankfein, describing the investment environment.

Blankfein said elevated stock values, with the S&P 500 trading at a price-to-earnings ratio above its historical average, is the result of an era of stimulus from the Federal Reserve, which has driven down bond yields and forced investors into relatively riskier stocks in the hunt for richer yields. Bond prices and yields move inversely.

The S&P 500 index is currently just about 2% off its all-time intraday high, while the yield on the U.S. 10-year Treasury note is 1.75% compared with 2.02% at this time last October.

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