Group 1 - The core assumption of the Fed Model is that stock pricing uses nominal interest rates rather than real rates, indicating an inverse relationship between interest rates and valuations [3][15] - The Fed Model has failed due to the low interest, low inflation, and low growth era, where investors rationally adjusted their expectations for future nominal profit growth, leading to declining valuations despite falling interest rates [3][18] - The implied equity risk premium (Implied ERP) calculated based on the DCF model provides better guidance for stock and bond yields compared to the Fed Model ERP for both US and A-share markets [21][23] Group 2 - The ERP (Fed Model) has shown strong guidance for US stocks from 1980 to 2002 but has significantly failed thereafter [7] - The Fed Model has no significant guiding effect on the Japanese stock market [10] - Adjusting for inflation using TIPS yields or actual rates has not significantly improved the Fed Model's explanatory power and predictive ability since 2002 [13] Group 3 - The calculation of Implied ERP relies on reasonable assumptions about future growth expectations, using the compound annual growth rate (CAGR) of past earnings for short-term growth and nominal GDP CAGR for long-term growth [21][22] - The relationship between stock and bond yields has been more accurately predicted by Implied ERP compared to Fed Model ERP, as evidenced by the performance in both US and A-share markets [23][25]