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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: bobby beara who wrote (2673)	12/22/1998 8:14:00 PM
From: yard_man	Read Replies (1) \| Respond to of 99985

Refresh me on those targets -- is that SPX cash?

To: bobby beara who wrote (2673)	12/22/1998 8:17:00 PM
From: yard_man	Read Replies (3) \| Respond to of 99985

Listen here! Frank says you are all wrong. <g> cbs.marketwatch.com >>It may be that we will have to throw out the old history books on finance since they haven't worked in the past three or four years. Multiples are up but no one has ever seen a world like this: capitalism triumphant, globally, accompanied by the ongoing restructuring of corporations to increase profitability. Additionally, fast-moving technology as exemplified by biotech and internet companies has created thousands of new investment opportunities. Sure, price-earnings multiples are up, but maybe we're at the brink of a new valuation of equities. Remember that multiples depend on two factors: earnings and interest rates. Interest rates are going lower. Earnings are valued not only on amount of growth but also the persistence of that growth rate over a longer period of time, and quality of those earnings (minimum leverage, no accounting gimmicks). Each of these elements has improved since the early 90's – overall earnings growth, longer lasting with better "quality" than the earnings of the 1980's. That should make for higher "multiples".<<