Moreover, if corporate dividend payouts are measured in GDP terms, the same stability can be observed. As a result, it is not so difficult to forecast future trends in the dividend yield numerator. Now, however, the nature of the game has changed considerably. Pause for a moment and do the dividend yield math. Not very high.
Dividend yields are sharply below their historic average.
Now take a look at the reasoning process needed to estimate future dividend yields. No one can forecast tomorrow's dividend yields without taking a stab at future capitalization levels. Those who reason from a conventional perspective expect the worst. Once the Dow levels off and the current joyride ends, the investor community will awaken to an unpleasant morning-after moment of truth. In frustration, many will bail out.