Because Stock Prices Have Soared, Returns in the Future Will Be Lower

The Washington Post had a piece on the wealth gap between whites and African Americans. It attributes much of the gap to the fact that African Americans with some amount of wealth are less likely to invest it in stocks and mutual funds and instead tend to hold lower yielding assets. It notes that this made a large difference as the stock market soared in recent years.

While this is true, because the stock market soared, and price to earnings ratios are above historic averages, it is likely to...