Can anyone do this?????
I'd like to see how many points the Nasdaq would fall if every stock were to return to a MAXIMUM PE ratio of 50. I really think everyone is finally waking up to this extreme valuation surge of the past 8-9 months. How long ago was it that everyone would allow a PE of 30-60 for high growth tech stocks? How long ago was it when a company had to show pretty certain prospects of profitability within say 1-2 years MAX? Can someone run a sheet of the stocks with PEs over 50 and those with no hopes of profit for over 2 years, then adjust the prices downward appropriately and translate that to the Nasdaq averages?
Also, I don't think most people realize what the effect of having the kind of leader the US has had for so many years, and how "the sins of the father" can all of a sudden haunt the children. Put another way, "what goes around comes around", and this talk about no recession during an election year being possible -- all I have to say is, the US has NEVER, and I stress that word, NEVER, had a leader such as they have had for the past 7 years, and it has been largely with the nation's blessing. So it would not surprise me at all to see the result be a catastrophic economic problem because that has been the ONE thing people in general have hung their hat on for so long now. The USA has ignored major evils (abortion, sanctioned drug dealings, selling of US military secrets, cover-ups, blatant lying, etc) all because of greed and the love of money. Perhaps we will see something unequalled in the financial underpinnings to drive home a point. Interesting times to say the least.
sice.oas.org
I'm starting to think my 60% leftovers may actually be able to buy the same companies at 1/2 to 1/4 their levels right now. Look at the following PEs or lack thereof, and tell me this market could not fall at least in half.
finance.yahoo.com.
When the consumer starts to worry and stop spending, and then starts to worry about their mutual funds, and then starts to, dare I say the word, instigate some REDEMTIONS instead of just feeding all these 20 and 30 something year old managers, I don't think a President, a Fed Chairman, a Congress, a Banker, or even the Houses will have a snowball's chance in Hades of stopping a recession or extended bear market. Sitting on cash (not much, mind you), I can't say I'd be disappointed to see a drop to Nasdaq 2000 and then a steady rise for the next few years, but what do I know. I've got my buys in already for QCOM (80), JDSU (50), PMCS (70), CREE (50), NOK (30), NTAP (35), NT (55), ITWO (45), RNWK (15), EBAY (50), YHOO (60), AOL (30). |
