A brief look at the Operating Earning / Price ratio (the data can be dowloaded here SP500 Report) let me astonished of how high the market is valued.
Here is a graph to illustrate my point.
Not only the operating earnings are low but the price of SP500 has been rising along with optimistic forecast about economy recovery. Alarmist and deflationists anticipates a drop in the SP500 value in the coming weeks or months that will revert the SP500 value to its 12 month average mean, but it may not happen ...or may be it will. The question is, can the investors do better than a random walk?
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