Thanks......it's hard to peel back the old crust on that portion of my brain, but after a little reading around google, I began to remember this stuff...their conclusions are laughable....jj
"by Dorsey D. Farr, Ph.D.
Vice President
Senior Economist
July 26, 2002
EXECUTIVE SUMMARY
Since the end of the second quarter, fear and worry have dominated the financial
markets, sending the S&P 500, the Dow Jones Industral Average, and the Nasdaq
Composite down 20%, 17%, and 16%, respectively.
Because of the recent market declines and a drop in interest rates, valuation
excesses appear to have been eliminated; in fact the market looks undervalued.
According to the Fed model, fair value for the S&P 500 at current interest rates is
about 1,240, implying that the S&P 500 is almost 35% undervalued as of July 23.
While we believe that valuations look attractive today relative to bond prices
(yields), we maintain that the absolute level of valuations still suggests a limited
upside potential for large cap domestic stocks over the next several years...."
balentineonline.com
another quote...
" Year 2002 2003 Est.
Operating Earnings $49.34 $59.58
SPX $932 $932
P/E 18.9 15.6
Earnings Yield 5.3% 6.4%
10 Yr Treasury 4.29% 4.29%
Fed Model Fair Value $1,150 $1,389
Under valued by $ $218 $457
Under valued by % 23.4% 49.0% "
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