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Strategies & Market Trends : Bob Brinker: Market Savant & Radio Host

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To: Boca_PETE who wrote (5158)5/25/1998 1:50:00 AM
From: kahunabear  Read Replies (1) of 42834
 
Pete,

It seems the real issue is whether or not P/Es are accurate. If they are, then paying 28 times earnings for the S&P 500 seems a bit ridiculous to me. A person in this month's Forbes cover story asserts that the actual P/E for the S&P 500 would be 35 if employee stock option compensation was expensed.

forbes.com

I think the real story is book value, though. After selling for 1 to 2 times book value through much of history, the market is now priced at a whopping 6 times book value. Wow, what a mania, IMHO.

WS
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