Is the stock market cheap?

Discussion in 'Trading' started by Port1385, Jan 25, 2009.

  1. [​IMG]
  2. Is fair value cheap to you?
  3. To get back to the lower trendline we'd have to get down to a P/E of 7 it appears. So assuming earnings stay the same (a very optimistic assumption) that would cut the sp500 in half again. So I'd say probably not cheap.
  4. Risk free money was yielding 15%+ back then.

    Risk free money yields 0%-3.5% depending on where you are on the yield curve right now.

  5. Meaning?
  6. Since 2000 and 2007, stocks have gone from being "overvalued" to "fairly valued". They still need to become "undervalued" where P/E's are in the mid-single digits and dividend yields are in the high-single digits. We may really have to re-live the 1930's. :eek: