Scott,
Very interesting interview with Tice. I have only two comments. First, it's worth reading a second time--I still could not find anything in his reasoning, per se, to disagree with in terms of his approach. I might take a different approach to his numericals, but not the thought process.
Second, let's see if we can find out where Tice (a "notorious"??? short seller--funny how doing the transaction in reverse would only make one a "fabulously successful" long buyer) points to a resting spot for the Naz:
"The S&P is selling at 33 times earnings, and there's been some charges in those earnings. The top 40 companies in the Nasdaq 100 are still selling at an aggregate of seven times sales. Seven times sales is a huge number. It's not unusual in a recession for companies to sell at seven times earnings. Seven times sales is just a joke. It's very, very, very high.
Q. What would be a reasonable level for the Nasdaq then?
One times sales."
Assume that sales stays even, if a Naz of 1500 is 7 times sales, then he's pointing toward an eventual Naz bottom of, drum roll, please:
214
Badda-bing. Hoo-law.
Burton Malkiel is putting out a feel-good, market-is-fairly-valued piece these days (yesterday's WSJ, if anyone can post it), so what the hell, let's just split the difference.
The blended Naz goal (Malkiel/Tice) is:
Naz 857.
Elevator is
going
down?
Kb |
