Treasury yields have been on the climb as of late. The 10 year Treasury is up as much as 30 basis points since mid September, and that climb has many dividend investors worried as to the value of the stocks they hold. Most income investors see rising yields challenging the value of income stocks, causing them to fall, but in the 15 times in the post war era that the 10-year has risen 1.5% from its low, the S&P grew by 12% annualized in this stretch. What this current Treasury climb has in common with its predecessors is inflation. The latest PCE posted a 30-year record, and that is being priced into Treasuries, which is eroding the traditional income stream. With realized gains in Treasuries lower than the nominal yields driving headlines, dividend investors might not need to be worried about stock valuations sinking. 

FINSUM: If yields were being driven by growth factors, we might see the more traditional relationship between interest rates and asset prices, but an inflation-driven cycle might not push investors away from dividend equities.