The S&P 500 is now trading at 131 times earnings

Current earnings are not that important, by historical standards in recoveries earnings soar by 6x the rate of GDP growth, its current operating earnings(when the recession ends so will one time charges and writedowns) and forward earnings(also forward GDP) that matters
 
I've addressed this in previous posts.

Not sure where to start with "Matthew Collins, A-Letter Editor", who either doesn't seem to be very experienced or is just interested in promoting a bear agenda.

P/E ratio is not a "complicated" concept nor does it have an endless amount of assumptions. Price is easy to understand..

As for earnings, the time period is typically one year forward OR LTM earnings. There is nothing complicated or "cooked" here really either.

If the number does not include write-offs from financial institutions, it is normally noted. Interesting that in an effort to either make things "simple", or to just promote his agenda, the author does not specify whether his forward number includes write-downs or not.

I've never seen someone calculate a P/E based on the "last couple of quarters". That's asinine.
 
Well if you look back Historically, say 30 years going back to the 80's, I would say the S&P should be right in the 850-950 range, exactly where we are now. I assume your assuming that this correction will continue at this current pace, I doubt it will and I anticipate a much slower climb back up.
 
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