Bottom-up consensus estimates for the S&P in 2009 were at $65.12 at the end of January and is obviously a pipe-dream. If the rate of earnings decline were to slow to 1.0% per week for the rest of the year, that would mean that earnings for the year would be only $41.01. That would imply a P/E of 18.2 at current S&P levels of 750.
Don't know. Could be that the revenue impact might not be all that much. Many of those who have become unemployed were not paying much tax anyway... though will have shifted from the "tax paying [if small] to unemployment benefit receiving" group... a greater cost to the social support system.
even if they were at 41.01 ..which i have heard lower ... does the sp justify a p/e of 18.2 ??!! i don't think so .
f9 Will be much lower than this..... http://money.cnn.com/2009/01/07/new...dget_outlook/index.htm?postversion=2009010717
Gracias. I see that report was dated jan 7, '09 and suggested a 6.6% falloff in tax revenue. Seems wildly optimistic to me. I have an amigo who is a dentist in LA and his revenues are off 40% y on y so far and falling. regards f9
f9, Wildly optimistic will be "an understatement".... About as reliable as official employment numbers.... You know the rest of the story.... There just seems to be a continual problem of getting people in the right places that can get ahead of the curve.... "Being ahead of the curve" is a real problem....
n00b all bad news priced in if anything, the markets will likely surge 400 points today and end the week up 15%? maybe people are shorting in droves in anticipation of more downside in equities and a 'global depression' that will never materialize.