Tuesday, March 06, 2018

2018. Pushing a decade off the lows.................

For what it's worth, here's my take..........
People responsible for 2008 financial collapse = No jail, $1 trillion bailout and a 'recovery' feel good story.

Today, there is a massive and unpayable $22 Trillion debt, there is at least $220 Trillion of unfunded liabilities and our 2018 deficit was $1.2 Trillion 2018.   Facts, just the facts.
For over 100 years, the average Shiller PE for the S&P 500 was 16.
Since 2000, this historic average has been the FLOOR; the absolute bottom of the range.  Even during the depths of the 2009 crash, the lowest it ever sunk to was 16. The floor used to be a PE of 8.  The lowest point of the acceptable range has doubled. 
The new “acceptable” average PE is now around 25.  Stock prices are trading up to 50% higher without having to earn any additional profit.  Indeed, the majority of the DOW 30 is making less money than they were 5 years ago.  Yet the DJIA has marched ever upward.
Add in the practice of buybacks and you can see how easy it is to push prices significantly higher simply based on changing the perception of “value”, even with DECLINING revenue and profits.
The FED has over $4 Trillion sloshing around doing nothing for Main Street and everything for K Street.   
The next one is going to be a doozy................

No comments:

Native American Advisors CHIPPEWA PARTNERS

My photo
CHIPPEWA PARTNERS, Native American Advisors, Inc. is a Registered Investment Advisor, founded by Dean Thomas Parisian in 1995. The firm is a manager to an exclusive clientele and is closed to new clients. As a Registered Investment Advisor, our expertise developed over 35 years balances experience, integrity and tremendous work ethic. Dean Parisian is a member at the White Earth Reservation of the Minnesota Chippewa Tribe, a former NYSE and FINRA arbitrator and trader who began his career with Kidder Peabody and later worked for Drexel Burnham Lambert in LaJolla, CA. His philanthropic interest is in Native American education and he's endowed a significant scholarship for Native Americans at the University of Minnesota. His greatest accomplishment includes raising two sons and 26 years of marriage. The Parisian family enjoys outdoor pursuits at Pamelot, their farm in Tennessee and at the Ghost Ranch, their ranch on the Yellowstone River in Montana. For media requests contact the firm via email: ChippewaPartners (at) gmail dot com, on Twitter: @DeanParisian. Global 404-202-8173