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To: hdl who wrote (184034)	7/27/2002 4:25:33 PM
From: Tommaso	Read Replies (1) \| Respond to of 436258

>>> Well, certainly the market cannot look much worse than it has over the past several weeks, Yesterday morning, the decline of the Standard & Poor's 500 Index surpassed the horrible 1973-74 bear market, before posting a strong afternoon rally<<< sharelynx.net The S&P 500 declined by 54% --from 120 to 65-- in 1973-74. If it declined that much now, it would be down to about 790. Now Siegel is closer than I thought he was, since the S&P did close at 852, but I think it has another 8% to drop before it equals 1974. But even at a level of 790, the P/E and yield of the S&P would be much higher than in 1974. It has dropped in the last two years from a much higher overvaluation. quote.yahoo.com^GSPC&d=c&k=c1&a=v&p=s&t=2y&l=off&z=m&q=l Lots more room to drop, IMO.

To: hdl who wrote (184034)	7/27/2002 4:58:57 PM
From: XBrit	Read Replies (2) \| Respond to of 436258

Siegel is pissing me off. The crucial point of his article depends on one throw-away sentence: <<Furthermore, my research suggests that the proper P/E level for today's market, with its low transactions costs, low inflation, and favorable tax rates for capital gains, should be in the low 20s, not 15.>> This sounds to me like some variant of the Fed model. I am deeply dubious of his underlying assumption... anybody have a link to where he explains this magic "research" of his? Was it maybe funded by Morgan Stanley or somebody?