Just a thought regarding the discussion surrounding P/E calculation: it appears you folks are comparing apples and oranges.
The most common usage of P/E is with regards to individual stocks and is the quotient of the stock's share price and earnings per share.
However, Ghost is referring to the P/E of a market, in this case the S&P 500. That calculation uses the index value instead of a stock's share price.
Two different things.
I was very clear about what I was referring to, even backing my post with data and references. However, other posters clearly did not understand the subject or context.
Jim Jones wrote:
Have you ever had an original thought, or do you just constantly mimic the talking points of those permabears whose altars you kneel at?
Even this he steals from others.
This guy is truly pathetic.
Perma bears. Jesus H. Christ. What kind of buffoon actually uses this term?
You just did.
I seem to care more about bonds than stocks right now.
1 year returns show that long term bonds have been the best moneymakers even though rates have risen strongly. Not what you'd expect.
Also not what you'd expect - all classes of bonds made money even as rates have risen.
This is not conventional wisdom.
Short: +0.70
Inter: +0.43%
Long: +1.07%
also, the CPI was up to 2.7% y/y last month - that's got to get the Fed's attention.
But apparently there was some fluke in energy prices that accentuated infflation.
"This is not conventional wisdom." = This time it's different.
I see you are slowly coming around in the face of the evidence.
Also the CPI used by the Fed doesn't even begin to tell the story of inflation--see shadowstats.com for a primer, you can use it as a start point.
Also look there for a primer on the bogus GDP number...which number, even after the historical revisions and subjective fudging, has just been revised down by the Atlanta fed to 0.9% seasonally adjusted annual rate, based on Q1.
BULLISH!
How do you reconcile those things? You cannot, through "conventional wisdom". You can if you understand that this era is about price inflation, and exclusivity, rather than on economic growth.
All the mechanisms are used to support prices. So we have a rate hike, so what? Everybody knows that people don't buy a house, they buy a monthly payment...so how do we keep those monthly payments down as the rates rise, without incurring a fall in price levels?
By changing the stated risk categories for borrowers, of course, by changing credit report criteria:
See how this is working? I have long opined that risk is not properly priced, and it starts with the large credit rating agencies. And it applies hugely to HYB's.
Things are just marvelous.....
Latest forecast: 0.9 percent — March 15, 2017
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2017 is 0.9 percent on March 15, down from 1.2 percent on March 8. The GDP growth forecast declined 0.3 percentage points on Friday when the February estimate of the model's latent dynamic factor used to forecast yet-to-be released GDP source data declined after the employment situation release from the U.S. Bureau of Labor Statistics (BLS). The forecast for first-quarter real consumer spending growth inched down from 1.6 percent to 1.5 percent after this morning's retail sales report from the U.S. Census Bureau and the Consumer Price Index release from the BLS.
Here's an interesting map:
https://en.wikipedia.org/wiki/Debt-to-GDP_ratio
And here is the progression:
http://www.tradingeconomics.com/united-states/government-debt-to-gdp
Comments anyone?
Ghost of Igloi wrote:
Things are just marvelous.....
Latest forecast: 0.9 percent — March 15, 2017
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2017 is 0.9 percent on March 15, down from 1.2 percent on March 8. The GDP growth forecast declined 0.3 percentage points on Friday when the February estimate of the model's latent dynamic factor used to forecast yet-to-be released GDP source data declined after the employment situation release from the U.S. Bureau of Labor Statistics (BLS). The forecast for first-quarter real consumer spending growth inched down from 1.6 percent to 1.5 percent after this morning's retail sales report from the U.S. Census Bureau and the Consumer Price Index release from the BLS.
I've said this before, but
squaring the weak GDP data with the very strong narrower economic reports is impossible. At least for me. I mean virtually everything else is showing very solid strength.
Ghost of Igloi wrote:
Things are just marvelous.....
Latest forecast: 0.9 percent — March 15, 2017
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the first quarter of 2017 is 0.9 percent on March 15, down from 1.2 percent on March 8. The GDP growth forecast declined 0.3 percentage points on Friday when the February estimate of the model's latent dynamic factor used to forecast yet-to-be released GDP source data declined after the employment situation release from the U.S. Bureau of Labor Statistics (BLS). The forecast for first-quarter real consumer spending growth inched down from 1.6 percent to 1.5 percent after this morning's retail sales report from the U.S. Census Bureau and the Consumer Price Index release from the BLS.
Growth is good.
Ghost of Igloi wrote:
I first posted here March 2, 2015.
Igy
OK-So you've been painting doom and gloom since your first post.
I have left all of the money I had in the market at that point in, but may be pulling it out tomorrow.
How has Blind Mellon not heeding your warning for 2 years been wrong?
Having a good strategy for consistently building wealth is a good strategy. Such a strategy will never be optimal, in the sense that some decisions will win, and some will lose, but a good strategy will win more than lose. No one can win all the time, and sometimes a fool will outperform a good strategy in the short term. A few fools will always guess and do better in the short run, just as there are always a few weekly winners leaving the casino and winning the lottery. Even so, the casino and lottery winners have a flawed strategy, since their expected returns are always negative.
Ghost of 29 wrote:
Having a good strategy for consistently building wealth is a good strategy. Such a strategy will never be optimal, in the sense that some decisions will win, and some will lose, but a good strategy will win more than lose. No one can win all the time, and sometimes a fool will outperform a good strategy in the short term. A few fools will always guess and do better in the short run, just as there are always a few weekly winners leaving the casino and winning the lottery. Even so, the casino and lottery winners have a flawed strategy, since their expected returns are always negative.
An answer like I expected! Blah Blah Blah
If I take all my retirement money to a craps table and win, I could say it was a good decision, but not a sound decision.
Ghost of 29 wrote:
If I take all my retirement money to a craps table and win, I could say it was a good decision, but not a sound decision.
I think everybody on here realizes the market is risky business.
Just because you've been running scared, stop being critical of people that are not buying in to the crap you've been preaching for 2 years. I think we all know how that has correlated with what the market has done over that period.
And it doesn't stay November of 2016 forever. Move on!
I haven't been preaching anything for 2 years. 2 months is more like it.
It is pretty obvious, Mellon, that you have the maturity of a masturbating monkey, and the temperament of a syphilitic bulldog - qualities that will ultimately limit your long term prospects of being a successful investor.
Ghost of 29 wrote:
I haven't been preaching anything for 2 years. 2 months is more like it.
Nice try!
I am a math professor, and Ghost of Igloi is not. I know such things as Taylor and Fourier series, orthonormal bases, curvilinear coordinates, Euler's method, Jacobians, Inner product spaces, and the like. Ghost of Igoi does not.
You are as deep as a 2-bit Turing machine.
Here is an uncomputable function: find the lower limit of Mellon's knowledge.