Clifford Asness, president and managing principle of AQR Capital Management, expects returns below the historical norm to be “the single largest factor out there we have to deal with.” He noted that stocks and bonds are both expensive right now, and that bonds may become more so if inflation increases and rates rise. “This could mean revert,” he says, “meaning we could have (prices) fall and restore good returns going forward, or we could stagnate for a long time.” He suggested that change in valuation or profit growth would address the problem.  “The only way (bonds) do better,” Asness predicted, “is if we get serious deflation.” He continued, “If we get a 10-year period of substantially better earnings growth, it solves a lot of problems.”