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Pastimes : The Justa and Lars Honors Bob Brinker Investment Club Thread -- Ignore unavailable to you. Want to Upgrade?

To: marc ultra who wrote (6504)	10/15/2011 10:44:59 PM
From: Investor2	2 Recommendations Read Replies (2) \| Respond to of 10065

Chart of the Day Today's chart illustrates how the recent rise in earnings as well as the recent stock market action has impacted the current valuation of the stock market as measured by the price to earnings ratio (PE ratio). Generally speaking, when the PE ratio is high, stocks are considered to be expensive. When the PE ratio is low, stocks are considered to be inexpensive. From 1900 into the mid-1990s, the PE ratio tended to peak in the low to mid-20s (red line) and trough somewhere around seven (green line). The price investors were willing to pay for a dollar of earnings increased during the dot-com boom (late 1990s), surged even higher during the dot-com bust (early 2000s), and spiked to extraordinary levels during the financial crisis (late 2000s). As a result of the recent spike in corporate earnings as well as relatively lower stock prices (e.g. the S&P 500 currently trades 11.7% off its April 2011 post-financial crisis highs) the PE ratio has dropped to a level that has not existed since 1990. chartoftheday.com

To: marc ultra who wrote (6504)	10/16/2011 5:57:17 PM
From: marc ultra	2 Recommendations Read Replies (2) \| Respond to of 10065

Lakshman and Bob in the Thunderdome. 2 men enter, one man leaves. While technically there may be wiggle room because they're not defining a recession in exactly the same way, the battle lines are now clearly drawn, one will be correct and one will be wrong. Today Bob flat out said the ECRI ("the private forecaster out of NY") will be wrong and those (like me) who have acted on their call will regret if. It's possible Bob might even be using me as as part of his example since when he was using an alias he would respond to me at various times (including praise at times), so if he glances at this board occasionally he is aware that I have flipped from bull to bear due to the ECRI call but obviously a lot of people have made investment changes based on the CRI so the possible personal point would not be that relevant regardless. For those into it this is epic stuff. Will the ECRI when it comes to market action end up like an Elaine Garzarelli making a disastrous reputation destroying sell call while Bob is on a flat out buy call? Will the ECRI's flawless record for the last 15 years finally come to an end downgrading them to just another fallible view sitting in the trash heap of history of forecasters? They didn't just say there could be a recession, they were adamant that a recession couldn't be stopped and things will get far worse. Lakshman did the full media tour after they released their call to the public and had that air of complete certainty and put full reputational capital into this call. It won't make that much difference to Bob or others doubting the call because no market timers or other economic forecasters have been perfect and institutions are not paying in the 6 figures for Bob's opinions as they are for subscriptions to the ECRI data and opinions. I still have to think the ECRI will prove right but it's certainly true my responding to the ECRI call has already been very costly. So I will be following this with extreme personal interest and my money for now is still on the ECRI but yes, I'm nervous about the possibility this could be a spectacular failure by the eCRI and I'm now in the uncomfortable position of finding myself rooting for a bad economy and bear market now that I'm committed that way.