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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 174.80+0.3%Dec 5 3:59 PM EST
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To: kech who wrote (121251)7/3/2002 10:07:57 AM
From: Wyätt Gwyön  Read Replies (3) of 152472
 
With Fed Funds at 1.75% you can get some pretty high expected multiples. 1/.0175 = 57 multiple

i should also mention that not even Greenspan uses the fed funds rate to value stocks. the so-called Fed model uses the 10-yr Treasury and compares this to the earnings yield on the SPX. with the SPX earnings yield at around 2.5% while the 10yr bond is at 4.8%, that implies the market is almost 50% overpriced.
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