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I stand by my comments on Commodities [balance] and S&P 500 PE's.
James Moltz, the inventor of the ISI Market Monitor is an especially
astute observer. He was recently written up in Jan 6 '03 Barrons. The
Market Monitor is usually early and went negative in '99 and went
positive of late. The Market Monitor is based upon several variables
including earnings, interest rates, stock and bond yields on a moving
average and advance decline line.
S&P 500 PE's per his accounting [ and my own screening which I do
weekly] have gone from 27 to 30 to currently around 15 to 16. There
is a cushioning from low level inflation and low level rates. In the
70's S&P 500 PE's went from 18 down to 7 because wage and price
controls were in place. If you think you are going to see the PE's of
the S&P 500 ever hit '70 levels, then go short now. I doubt whether
any of you have the courage of those convictions.
It could still take up to five years to climb fully back...but there
are many good investment opportunities...both long and short. The
trajectory of earnings increases may not always be as steep as one
would like, but it will be there over time.
John
------------------ Reply Separator --------------------
Originally From: "BobR" <bobrabcd@xxxxxxxxxxxxx>
Subject: Re: [RT] Commodities
Date: 01/12/2003 03:19pm
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