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S&P 500 May Jump 70% on Valuation, Economy Rebound, Fisher Says
- Thread starter Daal
- Start date
Quote from Daal:
"Stocks are cheaper compared to long-term interest rates than they have been in anyoneâs life,â he added.
Wall Street strategists estimate that S&P 500 companies will earn a total of $47.45 a share this year, according to the average projection of 11 forecasters surveyed by Bloomberg News. That gives the index a so-called earnings yield of 5.48 percent, dividing by yesterdayâs close. The 10-year Treasury bond is paying 2.84 percent, according to data compiled by Bloomberg. "
http://www.bloomberg.com/apps/news?pid=20601087&sid=aSOmYN8XM3Rc&refer=home
Earnings yield compared to interest rates?The reason risk free rates are so low its because the market thinks the economy is so bad
I think that the market has reached a very significant bottom. There is certainly no reason at this point to be shorting stocks even if your not thrilled to be a buyer of them.
Without paychecks,these companies wont be selling a lot of product. We need to get america rehired first,and before that we need to stop laying people off. Joe bama and geitner ought to shitcan the banking system,shore up joe public and his job,and restart the banks when the flood has passed. All these analysts are paid by a company who you hire to invest your money. All these bankers are paid the same way. There is a definite conflict of interest between his paycheck and the truth. They are going about everything ass backwards,until they figure that out ,they will continue to make a bad situation worse. Keep shorting.
Brandon f why have stocks reached a significant bottom? because scum wall street that led the sheep to slaughter in 2007 at 14k told us so?because the mkt's rising and that means for the millions already slaughtered the worst is over so trust us and jump back in? ASK YOURSELF A VERY FEW QUESTIONS AND YOU'LL HAVE YOUR ANSWER WETHER THE TRUE BOTTOMS IN. #1 what are the chances that in the midst of the worst econ downturn in 70 years the mkt has only 1 down year?what are the chances that in the midst of the worst downturn in 70 years not 1 major top 10 builder will go under?the worst housing crisis in history and no major builder has gone under yet)?unemployment is still rising which means many more foreclosures to come.Not 1 top 20 retailer has gone under yet. not 1 top 10 casino has gone under yet. commerical real estate just recently started its downturn and has along way to go.are we supposed to just blindly assume because the mkt is rising all is ok? WHAT FEW UNDERSTAND IS AS THE ABOVE EVENTS UNFOLD AND WELL KNOWN CO'S START FALLING LIKE DOMINO'S CONFIDENCE WILL BE SHAKEN AGAIN THUS CASCADING THE MKT DOWN.. oh i forgot the mkt discounts the future and will agnore the above. you're really underestimating joe six packs intelligence. wall street has lied to him and cheated him out of his money and you think he'll just turn on a dime and return?things have changed forever and it will take decades to get out of this.
Quote from Daal:
"Stocks are cheaper compared to long-term interest rates than they have been in anyoneâs life,â he added.
Wall Street strategists estimate that S&P 500 companies will earn a total of $47.45 a share this year, according to the average projection of 11 forecasters surveyed by Bloomberg News. That gives the index a so-called earnings yield of 5.48 percent, dividing by yesterdayâs close. The 10-year Treasury bond is paying 2.84 percent, according to data compiled by Bloomberg. "
http://www.bloomberg.com/apps/news?pid=20601087&sid=aSOmYN8XM3Rc&refer=home
Earnings yield compared to interest rates?The reason risk free rates are so low its because the market thinks the economy is so bad
That's one method, but the other most likely more relevant method is on an absolute price to book basis, where the current median price to book is 0.9, when it is usually around 1.5 to 1.6. This corresponds to the near 70 percent rise they are talking about. Only fools can price us this low.
Quote from jnorty:
Brandon f why have stocks reached a significant bottom? because scum wall street that led the sheep to slaughter in 2007 at 14k told us so?because the mkt's rising and that means for the millions already slaughtered the worst is over so trust us and jump back in? ASK YOURSELF A VERY FEW QUESTIONS AND YOU'LL HAVE YOUR ANSWER WETHER THE TRUE BOTTOMS IN. #1 what are the chances that in the midst of the worst econ downturn in 70 years the mkt has only 1 down year?what are the chances that in the midst of the worst downturn in 70 years not 1 major top 10 builder will go under?the worst housing crisis in history and no major builder has gone under yet)?unemployment is still rising which means many more foreclosures to come.Not 1 top 20 retailer has gone under yet. not 1 top 10 casino has gone under yet. commerical real estate just recently started its downturn and has along way to go.are we supposed to just blindly assume because the mkt is rising all is ok? WHAT FEW UNDERSTAND IS AS THE ABOVE EVENTS UNFOLD AND WELL KNOWN CO'S START FALLING LIKE DOMINO'S CONFIDENCE WILL BE SHAKEN AGAIN THUS CASCADING THE MKT DOWN.. oh i forgot the mkt discounts the future and will agnore the above. you're really underestimating joe six packs intelligence. wall street has lied to him and cheated him out of his money and you think he'll just turn on a dime and return?things have changed forever and it will take decades to get out of this.
Have faith in the utter rationality of markets. They're too cheap, and every foreign investor in the world will flock to come buy our companies b/c it is in their best interest to. If not for our companies, then for our sovereign debt.
Quote from jnorty:
Brandon f why have stocks reached a significant bottom? because scum wall street that led the sheep to slaughter in 2007 at 14k told us so?because the mkt's rising and that means for the millions already slaughtered the worst is over so trust us and jump back in? ASK YOURSELF A VERY FEW QUESTIONS AND YOU'LL HAVE YOUR ANSWER WETHER THE TRUE BOTTOMS IN. #1 what are the chances that in the midst of the worst econ downturn in 70 years the mkt has only 1 down year?what are the chances that in the midst of the worst downturn in 70 years not 1 major top 10 builder will go under?the worst housing crisis in history and no major builder has gone under yet)?unemployment is still rising which means many more foreclosures to come.Not 1 top 20 retailer has gone under yet. not 1 top 10 casino has gone under yet. commerical real estate just recently started its downturn and has along way to go.are we supposed to just blindly assume because the mkt is rising all is ok? WHAT FEW UNDERSTAND IS AS THE ABOVE EVENTS UNFOLD AND WELL KNOWN CO'S START FALLING LIKE DOMINO'S CONFIDENCE WILL BE SHAKEN AGAIN THUS CASCADING THE MKT DOWN.. oh i forgot the mkt discounts the future and will agnore the above. you're really underestimating joe six packs intelligence. wall street has lied to him and cheated him out of his money and you think he'll just turn on a dime and return?things have changed forever and it will take decades to get out of this.
That's exactly why. You can fight it, you can bitch and kick and scream all you want..and the only thing it's going to do is empty your wallet.
I'm not a permabull, or a permabear just a trader. I have a well documented track record over the years. From the bottom in 1998 up until December of 2000 I was telling people to buy big cap tech with both hands. In December I switched and said go to biotech and we did that until the end of January and which point I told people to go to cash. In April I said you could short.
After September 11th I bought networkers and airlines until December, then went back into cash until the bombs starting falling Iraq in 2003. Stayed bullish until 2005, at which point I became ill.
At the end of 2007 when the DOW was making new highs, I sent out letters to my subscribers litteraly begging them to move into cash. More significantly though then that I was managing over $10million at that point, and I moved all of it to cash. I did this even though every single client I had objected, many of them pulled funds from me because of this move. It was the right thing to do though.
You see, I do base my opinions on market actions and facts. What I "THINK" should happen because of this or that is not material at all.
Right now the market is very bullish and there is no reason to be short.
As I said in my post as well I'm not really compelled to buy very much right now, but to be short is to be an idiot.
If you care to take the time to go through my posting history you will see that I'm not just selecting the ideal situations as everything I've done over the last nearly 1 decade is well documented here on ET.
Brandon
Brandon you think you're talking to some wet behind the ear guy? i'm one of the most hard core day traders out there trading with broadway in the late 90's with some of the best traders of all time and making 7 fig's almost every year for the 10 years.I could give 2 shits wether the mkt runs or crashes as i'm pouncing 1000-2000 times a day. I'm simply making conversation about wether the bottoms in and I SAY NO. wether it is or not will have no bearing on another 7 fig year in 2009. I'm fighting no trends.