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Strategies & Market Trends : JAPAN-Nikkei-Time to go back up? -- Ignore unavailable to you. Want to Upgrade?

To: Fun-da-Mental#1 who wrote (1981)	7/25/1999 10:53:00 AM
From: Professor Dotcomm	Read Replies (1) \| Respond to of 3902

No. I don't follow you. Dividend yield criteria came at a time when people were looking at equities rather than government debt. Sometimes they had to accept lower yields than those current on government bonds - hoping that future yields would be higher. Then the Americans refined this to the total earnings of a company - whether they paid out these earnings or reinvested them in the company. Hence p/es. Then EV came along and said. OK we have these earnings in the recent past but what about the next five years? Internet is something else. It is saying that if the public buys your product in sufficient volume then, ipso facto, you will be the leader. The Japanese are not quite there but they tend to think in 5-10 year cycles in front of them - rather than what went on in the past. It's the only way I can reconcile the monstrous apparent p/es right now. And, you know, they may be right!