interesting point to keep in mind
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"As short rates move up, so does the required return for equities, and given our negative market outlook, we believe it becomes increasingly difficult for equities to outperform cash," Chakrabortti wrote in a report to clients.
J.P. Morgan estimates the benchmark lending rate, known as fed funds, will reach 4.5 percent by the start of 2006. Federal Reserve policy makers have raised the lending rate 11 times since June 2004 to 3.75 percent.
"Earnings need to grow at trend just to keep in pace with the required return to outperform cash," he added. "Given our zero earnings growth forecast for 2006, this becomes highly unlikely."
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