Mike, I agree with everything you say. But, and it's probably my fault for not knowing the nomenclature, it's not responsive to the point I wanted to make.
I suggest that comparing the P/Es of coke to microsoft to pfizer to whathaveyou, in October, 1998, is much closer to comparing apples and apples, and more likely to be valid and helpful than trying to compare the P/E of coke in 1932 to the P/E of coke in 1998, due to changes in accounting standards, changes in valuation of currency, etc. I further suggest that comparing the P/E of microsoft in 1998 to the P/E of the biggest cap in 1932 is more like apples and oranges, for the same reason, and also for reason I posted elsewhere today, that Microsoft doesn't pay dividends, for tax purposes, which pleases its investors, so it's P/E is skewed compared to companies that do, and did.
I think this is empirically true, whether it is significant I don't know. Your insight, as always, appreciated.
Now, if I read 100 posts a day, it should only take about a year to read all the prior posts in this thread, so, adieu.
CobaltBlue |
