We analyze the period before the zero lower bound and show that the state of investor sentiment strongly affects the transmission of monetary policy to the stock market. The impact of Federal funds rate (FFR) surprises is mostly potent when sentiment-driven overvaluation is followed by a...

We investigate the impact of monetary policy shocks on excess corporate bonds returns. We obtain a significant negative response of bond returns to policy shocks, which is especially strong among low-grading bonds. The largest portion of this response is related to higher expected bond returns...

Using a sample of U.S. public firms between 2010 and 2019, we document a positive relation between firm-specific investor sentiment (FSIS) and total factor productivity (TFP). The positive relation remains robust to three identification methods: a difference-in-differences (DID) analysis...