Guidolin, Massimo - Federal Reserve Bank of St. Louis - 2005
Economic Association meetings in Stockholm (August 2003), the European Financial Management Association in Basel (July
2004 …-period, risk-free, zero coupon bond in endogenous zero net supply,
yielding an interest rate of r
t
(hence B
t
=
1
1+r
t
where B is … the bond price), and a stock index with price S
t
in exogenous net unit supply. The stock pays an in�nite stream of real …