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Strategies & Market Trends : Classic TA Workplace -- Ignore unavailable to you. Want to Upgrade?

To: skinowski who wrote (130792)	3/16/2006 2:15:51 PM
From: Shack	Read Replies (3) \| Respond to of 209892

Major OT*, mainly because I am bored. What follows has nothing to do with trading! Re: SPX/TNX, I don't see how it is relevant, even intuitively. The absolute price of the SPX is an arbitrary number supposedly based on a multiple of earnings, earnings which have grown year after year. I mean what if at the current level of 1300 SPX stocks were trading at a ridiculously low P/E multiple of 5? Presumably this ratio, a ratio based on the concept of the Fed model of stock valuation would have to get higher and higher before any sort of putative extreme is hit......an extreme which supposedly has the price of bonds relatively cheap compared to stocks, a ratio which means absolutely nothing as the SPX breaks up out of a rising wedge on its weekly chart!**-ng