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Strategies & Market Trends : Waiting for the big Kahuna -- Ignore unavailable to you. Want to Upgrade?

To: Investor2 who wrote (27137)	9/9/1998 9:28:00 PM
From: Vitas	Read Replies (1) \| Respond to of 94695

<<I now see that the current S&P 500 level is far, far above the top channel>> Looks like a breakout to the upside above a very long term channel. Vitas

To: Investor2 who wrote (27137)	9/9/1998 9:46:00 PM
From: Joseph G.	Respond to of 94695

Briefly, (i) there is indeed a non negligible uncertainty in "correction for inflation", IMO, real inflation, that would also include much higher tax levels, is greater, perhaps by ~ 25% from 100 years ago. That would take present valuation down ~20%, closer to the top line. (ii) however, this correction still leaves July 1998 peak SPX = 980 on the scale of that chart, much above the upper trend line. And indeed, if one normalizes market cap by GDP, at the 1929 peak the cap/GDP was ~80%, while two months ago it was ~145%, pointing to greater overvaluation this time ... The New Era theory points out that this greater valuation is fair because of various reasons (global economy, world peace, technology, internet, political stability ...) FWIW