Monday, May 9, 2016

On the Strong Performance of REIT Stocks

Viresh Amin emails and asks:
Just a simple observation of the market, going through many names and industry groups and it is interesting to see that the REITs are making the highs list. Can you if you have the time help explain how this may fit into the "this is not what a recession looks like" slogan you have posted many times.
 RW reply:

Nothing surprising about this, REITS (real estate investment trusts) are at the heart of the capital goods sector. Capital goods sectors are the sectors that outperform when the Fed is flooding the economy with money.

They are also the sectors the that experience the greatest collapse in the bust phase.

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