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To: Box-By-The-Riviera™ who wrote (172457)	6/13/2002 11:09:27 AM
From: Knighty Tin	Read Replies (1) \| Respond to of 436258

JG, It is amazing what pros don't know. Two people from two different fund cos. tried to make a bullish case for stocks based upon the cost of money being low. The cost of money is low, so that's a plus. However, they dragged out the hallowed name of Ben Graham, the greatest value manager of all time. Graham had a matrix of long bond rates vs. 5 year growth resulting in a pe ratio. Both guys claimed the S&P 500 was way under valued on this basis. I looked at the chart and had to disagree. The difference of opinion was that they were confusing long bond rates with T-Bill rates. And operating eps with GAAP eps. Any matrix where you plug in 1.8% instead of 5.5% for the rate, and 24 times eps instead of GAAP 41 times eps will give you slightly different results. BTW, the 500 is 45% overvalued when using Graham's matrix with the correct numbers. <VBG>