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Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: pater tenebrarum who wrote (1895)	12/11/1999 6:41:00 PM
From: fut_trade	Read Replies (1) \| Respond to of 19219

Heinz, could you summarize A.G.'s "engineering" of money supply since 1995. It looks to me that the forward P/E of the SPX climbed rapidly from 12 in 1995 to 21 in 1998. As part of the historical cycle the forward P/E should have fallen back down to say 12 or 13, but instead it looks like it was forced back up to 21 in the last six quarters. It looks like the valuation of the market has been manipulated to a forward P/E of about 21. You can see that this does look like an historical upper limit, nearly reached in the late 50s and reached in the late 60s. geocities.com I'm just curious if this chart is consistent with the recent increases in money supply. It seems that unless liquidity is injected into the market, the valuation will correct, as shown by the sharp drops of the last 4 decades.