Partially OT.
Paul,
I think that you probably should not adjust your views on PEs. IMHO, the market is starting to look expensive. A lot of stocks have run up, trading at 52 week highs and cheap opportunities are few. Yeah, there are pockets of cheapness still, but mostly for companies where market expects (rightly or wrongly) business dropoff in sales and earnings. In addition even the expectations of dropoff are becoming fewer. E.g. WU says that business is gonna drop this year and market pretty much shrugs off the report. Yeah, it's still somewhat cheap, but not as cheap as couple months back.
Personally, I find very few things to buy - which is good for me, since my cash is below 20%. I should sell and I might sell to get cash up. If your cash levels are high, buying now might not be a good time.
Of course, I can't predict market. We could be entering a bull, especially if economic news continue to be good. It just feels similar to times when the prices were high, values were few, and market dropped after a while.
It's mostly hand waving though, so I'll say that I could be very wrong here and it's probably mostly OT. :) |
