Preferred Stock Or 10-Year Treasury Yield - Something's Got To Give

Even with all of the posturing that goes on in Washington, D.C., the fact remains that investors see U.S. treasury bonds as one of the safest investment alternatives. Prior to the crisis, it took an average of 2.4 percent in additional yield above that offered by the 10-year treasury to compensate preferred stock investors for the additional risk of the highest quality preferred stocks. After the crisis, preferred stock investors have received an average of 4.1 percent in additional reward with today's preferred stock buyer being rewarded with an additional 3.5 percent yield. If this spread is going to return to normal, something's got to give...

Note To Readers: This article was chosen to appear on the popular investing website 'Seeking Alpha'.

By clicking here a new window/tab will open on your screen to this article as it appears at SeekingAlpha.com.

Receive my Seeking Alpha articles by email: When viewing one of my articles at Seeking Alpha, click on the "Follow" button under my picture. You will be notified by email when I post a new article to Seeking Alpha.

Please enjoy reading this article at Seeking Alpha.

Many Happy Returns.