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To: Jacob Snyder who wrote (53902)	10/7/2001 10:29:17 AM
From: Proud_Infidel	Read Replies (2) \| Respond to of 70976

The LT range for the S&P 500, is to stay in a PE range of 10-20, with a LT average of 15. In recessions, it can be expected to hit a PE of 10 To answer the market valuation question, I believe one should create a basket of stocks for comparison. Many in the Nasdaq 100 are still trading at enormous PSR's and give the impression that the "market" is overvalued, which is incorrect IMO. For example, look at ORCL and MSFT, with PSR's of nearly 7 and 11, respectively, and compare that to a GLW or an AMAT, which carry PSR's of 1.07 and 2.7, respectively. One cannot make broad statements about an overall market over or under valuation when so many are trading near historic troughs, while a few still expensive issues skew the numbers. Brian

To: Jacob Snyder who wrote (53902)	10/8/2001 10:52:43 PM
From: John Trader	Respond to of 70976

Jacob, A very good analysis, thanks for sharing your inputs, and how you arrived at your conclusion. I still think it is very hard to predict the market, however. Well, for me at least! Actually, I think I am not alone in this regard. Most economists seem to have difficulty as well. So maybe it is good I am not spending much time on this now. Also, my personality type is such that I tend to be too optimistic most of the time - not very good in bear markets, Ugghh. Regards, John

To: Jacob Snyder who wrote (53902)	10/9/2001 11:47:34 AM
From: Hank Stamper	Read Replies (4) \| Respond to of 70976

Nice analysis. How is it possible that the p/e could get to 10 or lower? Through a series of bear/bull cycles in which each cycle progressively lowers the high and low p/e. In this senario, the last bear bottom brings us to the range of the historical low p/e. This is the opposite side of the coin of the expanding p/e ratios we saw develop between 1982 and 2000. How long will that take? I.e., how many bear/bull cycles will we see before we hit the final, final bottom with a p/e close to 10? It would be interesting to know the mean p/e contraction in a typical bear. Then, one would multiply the contraction value by the average length of a business cycle to arrive at a hypothetical time frame for the final, final bottom in the series. Is this wacked out or what? Ciao, Hank Stamper

To: Jacob Snyder who wrote (53902)	10/18/2001 12:49:40 AM
From: Wildstar	Read Replies (1) \| Respond to of 70976

Jacob, Re: Market valuation Nice post (the one which I am responding too). The one thing you didn't mention is that the Nasdaq was quite possibly the biggest bubble in US history during the late 90's. The recovery may not follow "normal" patterns. I read this quote on another thread: Speculative bull markets have NEVER (keyword there) NEVER bottomed at levels above the historic trailing mean valuation multiples...quite the opposite in fact. I don't know the validity of this statement, but if true the Nasdaq still has a long way to fall in the future.