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Albert Edwards: "We Are Returning To 450 On The S&P"

Tyler Durden's picture

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Thu, 08/26/2010 - 12:46 | 546024 OrdellRobbie
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support and resistance bitchez!!!

Thu, 08/26/2010 - 13:27 | 546129 NoBull1994
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The problem with this analysis is that 450 in 1982 and 450 and 2010 are two completely different numbers in real dollar terms.  Albert needs to adjust his math for inflation.  My guess is that 600-700 is the bottom.

Thu, 08/26/2010 - 13:49 | 546179 Roi
Roi's picture

He is talking P/E vaulations. The S&P was around 125 in 1982.

Thu, 08/26/2010 - 13:53 | 546186 thesapein
thesapein's picture

Nah, we really should stop "adjusting" for inflation every time someone asks. Stop trying to manipulate the numbers around the dollar. It just hides the facts.

Thu, 08/26/2010 - 14:36 | 546320 Marc45
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That's fine as long as you're not referencing or pricing in terms of dollars.  Otherwise, the "value" of the dollar is material.

Thu, 08/26/2010 - 15:50 | 546494 thesapein
thesapein's picture

Just stop, please. To "adjust" for inflation you have to make changes to the rates based on a basket of rates that also changes who contents might come and go and which also change in their rates... It's like an orgy of fiat adjustments.

Why manipulate the original data?

If you really want to see what's happening before tying to make it looks a certain way, try a more scientific approach, using real data.

Thu, 08/26/2010 - 15:57 | 546512 Ripped Chunk
Ripped Chunk's picture

It's actually getting funny the comments that get junked here now a days. Turning into Troll City.

I think I will lease some foreclosed on land from Wells Fargo and  open an amusement park called Troll City just to see who shows up.  Of course the bankers will want a free tour before the grand opening. We can test the acid dousing and Gatling guns in the fun house on them........ 

Thu, 08/26/2010 - 16:04 | 546541 RichardENixon
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I automatically junk anyone who uses "bitchez" at this point, it's gotten so lame.

Thu, 08/26/2010 - 16:07 | 546550 Ripped Chunk
Ripped Chunk's picture

But I didn't use "bitchez"??  I just assumed I got junked by a Wells Fargo employee.

My response to that is: Bring the whole family for a day of fun at Troll City! Free hot dogs!

Don't want a bunch of little future bankers living to see tomorrow either.

Thu, 08/26/2010 - 16:13 | 546578 RichardENixon
RichardENixon's picture

I didn't junk you Ripped.

Thu, 08/26/2010 - 16:18 | 546591 Ripped Chunk
Ripped Chunk's picture

I didn't think you did because neither myself nor the two commentators above who made legitimate remarks that should not have been junked used "bitchez".  Like I said, it's TROLL CITY

Thu, 08/26/2010 - 16:18 | 546592 RockyRacoon
RockyRacoon's picture

You used "bitchez" -- I junked you!

Thu, 08/26/2010 - 16:27 | 546623 RichardENixon
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Good one Rocky.

Thu, 08/26/2010 - 17:03 | 546713 Ripped Chunk
Ripped Chunk's picture

Rules are rules. Lets take the SEC for example.....................

Thu, 08/26/2010 - 21:30 | 547226 Dr. Sandi
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You used "bitchez" -- I junked you!

Damn your ring-tailed logic.

Thu, 08/26/2010 - 18:18 | 546878 OrdellRobbie
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haha junked me you pussy

Thu, 08/26/2010 - 14:36 | 546323 cougar_w
cougar_w's picture

Exactly. Inflation is part of the problem.

"The doctor says I'm quite fit ... for someone who has terminal cancer. My weight loss is therefore a good thing. By the time I'm actually dead, I'll be in perfect health for a person recently deceased."

Thu, 08/26/2010 - 14:51 | 546356 The Rock
The Rock's picture


Thu, 08/26/2010 - 15:54 | 546510 thesapein
thesapein's picture

awesome metaphor!

Might I add that you could be seen as healthier in comparison if most every one else were also suffering from disease.

Thu, 08/26/2010 - 16:39 | 546642 cougar_w
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And there are whole segments of the cosmetics industry and all of plastic surgery devoted to achieving nothing else. No slam against the terminally ill, but it's illusion.

Propaganda works at many levels.

Thu, 08/26/2010 - 17:13 | 546745 rosiescenario
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...amazing what a course of 5FU can do to any weight issues one might have had....

Thu, 08/26/2010 - 22:59 | 547368 chindit13
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Once you are dead, the rate at which your health is declining will slow to zero, which represents an inflection point, now known euphemistically as a "Green Shoot", and in the funeral industry as "Pushing Daisies".

I am now convinced that Lazarus did not actually rise from the dead and walk, but only that his rate of decline slowed.  I then went to the Mormon Church archives, which have the world's best genealogical records, and found that one of the descendants of John (Gospel of John) is Steve Liesman.  It all began to make perfect sense.

Thu, 08/26/2010 - 15:38 | 546466 hangemhigh
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s&p 450 actually takes us back to august 1994 which is when abby joseph cohen first made her bones and this massive ramp in equities really began.  the dow at the same time was about 3600.

were we to return to those numbers (sp450 / dow 3600) it would mean 'reversion to the mean' in spades........  

Thu, 08/26/2010 - 16:23 | 546611 spinone
spinone's picture

Thats returning to the mean.  Reverting to the mean is when the line goes below the average low enough, and stays there long enough to keep the mean the same over time.  The area of the curve above the mean has to equal the area of the curve below the mean of the CAPE.  Or else the mean has changed, and everything is different this time.

Thu, 08/26/2010 - 17:12 | 546741 anony
anony's picture

Bet your sock drawer has precisely 7 pairs of perfectly folded anklets.

Thu, 08/26/2010 - 17:18 | 546754 Helix6
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Won't happen.  The CPI in 1993 was 145.  Now it's 218.  450 * 218 / 145 = 676 in today's dollars.  If you can believe the CPI, that is...  I tend to think it's much higher, giving an equivalent S&P of around 900.

Thu, 08/26/2010 - 22:53 | 547357 masterinchancery
masterinchancery's picture

The fundamentals in 1982 were soooo much better than they are now, with p/e's of solid stocks at 4-5.

Fri, 08/27/2010 - 09:12 | 547913 torrente
torrente's picture

Never forget inflation that time was double digit heavily affecting DCF valuations.

Mon, 10/11/2010 - 02:57 | 640404 ebworthen
ebworthen's picture

Two years ago I calculated that when we played out the 1929-1932 scenario (a loss of ~79%) we could end up at DOW 2,900 and S&P of ~326.

It happened then, it could happen now.

Except that now, lots less people know how to grow and raise their own food and we hadn't yet then prostituted our manufacturing and industry out to our biggest competitor.

Thu, 08/26/2010 - 13:57 | 546197 Turd Ferguson
Turd Ferguson's picture

fuck a duck

Thu, 08/26/2010 - 14:09 | 546241 Pladizow
Pladizow's picture

Fee Fi - Fo Fitty!

Thu, 08/26/2010 - 12:47 | 546028 Yikes
Yikes's picture

Looks like I picked the wrong decade to stop drinking.

Thu, 08/26/2010 - 13:04 | 546060 JenkinsLane
JenkinsLane's picture

Looks like I picked a bad day to quit smoking.  

Thu, 08/26/2010 - 15:52 | 546502 Henry Chinaski
Henry Chinaski's picture

Got completely out of smoking in 2006,then doubled down on vodka. 

Lately, I drink vodka like it's my job.

Thu, 08/26/2010 - 15:59 | 546526 Ripped Chunk
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Don't worry, it's drink like a pirate day (ever day)

Thu, 08/26/2010 - 17:03 | 546711 Rusty Shorts
Rusty Shorts's picture

 - yeah, I've put away several barrels of beer and wine since joining ZH a year ago...wait, WHAT, it's my ZH birthday Bitchez !!!!

Thu, 08/26/2010 - 17:04 | 546718 Ripped Chunk
Ripped Chunk's picture

Oh Yea!

Vodka! It's always for breakfast now!

Thu, 08/26/2010 - 22:22 | 547307 ColonelCooper
ColonelCooper's picture

And it's always seven in the morning.


Thu, 08/26/2010 - 13:33 | 546141 Occams Aftershave
Occams Aftershave's picture

Yes, put away some cash for a rainy decade.

Thu, 08/26/2010 - 14:29 | 546298 Max Hunter
Max Hunter's picture

++  LMAO

Thu, 08/26/2010 - 14:39 | 546330 dukeness
dukeness's picture

Looks like I picked the wrong decade to stop sniffing (bullish) glue.

Thu, 08/26/2010 - 17:14 | 546748 rosiescenario
rosiescenario's picture


Thu, 08/26/2010 - 16:12 | 546572 Hard1
Hard1's picture

hahahaha same here!!! and smoking....I guess I'll just pick it up again Cheers!!!

Thu, 08/26/2010 - 17:17 | 546750 rosiescenario
rosiescenario's picture

...me too, and I'll double up on the snuff dipping...that should helpspeed the end of the 'lost decade'...maybe I can get it down to 200 dayz???

Thu, 08/26/2010 - 17:17 | 546753 rosiescenario
rosiescenario's picture

...me too, and I'll double up on the snuff dipping...that should helpspeed the end of the 'lost decade'...maybe I can get it down to 200 dayz???

Thu, 08/26/2010 - 12:49 | 546030 Gimp
Gimp's picture

Everytime I start shorting the ponzi masters pump it up, pump it up. Classic squeeze, trap, balls stuck in the golf ball washer.

I will watch and wait as the big PONZI could go on for a while before any sign of collapse.


Thu, 08/26/2010 - 12:54 | 546036 papaswamp
papaswamp's picture

hey they have to keep it pumped up until election time.

Thu, 08/26/2010 - 13:10 | 546081 giddy
giddy's picture

...and knowing that helps guide decisions...

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