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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: ild who wrote (56122)	3/19/2006 9:20:23 PM
From: ild	Read Replies (1) \| Respond to of 110194

Everything Looks Good at the Top of the Channel Most of the time, S&P 500 earnings have been substantially below the 6% growth line that connects historical earnings peaks. So you might guess that the average historical P/E, when earnings have been at the top of their channel (as they are now), would probably have been something less than 15. And you'd be right. Excluding the late 1990's bubble peak, the price/earnings ratio for the S&P 500, when earnings have been within 5% of that top channel, has historically averaged just 9.0. The current multiple is 18.3. Makes you think. By John P. Hussman, Ph.D. hussmanfunds.com