Just as the price of a share should equal the discounted present value of future profits, so the price of a house should reflect the future benefits of ownership either rental income or the implicit rent saved by an owner-occupier.

ECONOMIST: The higher they climb, the further they will fall

Just as the value of a company's shares should equal the discounted present value of its future profits, so the price of a house should reflect the future benefits of ownership, either as rental income or in the rent saved by an owner-occupier.

ECONOMIST: Global house prices

Moroney argues that with low interest rates and low inflation, the present value of future profits goes up and so do the multiples investors are willing to pay for companies with higher profit growth.

FORBES: Magazine Article

They have discussed using some of the money raised for a one-off payment to the state, representing the bank's estimate of the present value of its future profits up to 2014, when the special dividend is due to be scrapped.

ECONOMIST: French banking