PE Multiple

The Witching Hour For US Stocks

When you layer on the current low volatility environment a scenario pops up: one with an equity market that very quietly returns 5-8% with very little price fluctuations.  Yes, in the past that scenario would pull investors into the fray and make for an artificially overvalued market, and then a fall. But the current crop of investors has been around for 3 notable bubble bursts: dot com, housing, and Financial Crisis. Will they get sucked in again?

"The Jinga's Up"

When valuations reach extremes, despite what the masses say, even greater fools run out.

Just Plain Pathetic

We are speaking, of course, of the Fed’s decision to punt yet again, and for a reason that is not mysterious at all. To wit, our financial rulers are petrified of a stock market hissy fit, and will go to any length of dissimulation and double-talk to avoid triggering a crash of the very bubbles their policies have inflated.

Morgan Stanley Throws In The Bearish Towel, Sees S&P At 2,300 On A 19x "Bull Case" PE Multiple

"We are raising our 12-month price targets for the S&P 500 – base case from 2200 to 2300, bear case from 1600 to 1800, and our bull case from 2400 to 2500... For the bull case, we are leaving our EPS essentially unchanged, moving the out year from $137.1 down to $136.5, but raising our bull case multiple from 18x to 19x, yielding our new 2500 bull case forecast."

The Apotheosis Of Bubble Finance - Folly Of The FANGs, Part 1

"The trouble is, financial prices cannot be falsified indefinitely. At length, they become the subject of a pure confidence game and the risk of shocks and black swans that even the central banks are unable to off-set. Then the day of reckoning arrives in traumatic and violent aspect."

On The Impossibility Of Helicopter Money And Why The Casino Will Crash

Will the boys and girls still in the casino after the current election gong show is over patiently wait for their next fix from a beltway governance process that is in sheer pandemonium and stalemate? We think the odds are between slim and none. As we indicated previously, if Trump is elected the fiscal process will lapse into confrontation and paralysis for an indefinite spell. And if Hillary is elected, the Republican House will become a killing field for almost anything she proposes, and most especially the rank Keynesian apostasy of outright and massive debt monetization...

America Needs A Good, Old-Fashioned Economic Depression

A good, old-fashioned, pre-1929 depression (like the short-lived, eleven-month depression in 1920-1921, before the days of “modern” central banking and “enlightened” Keynesian intervention “cures”) is the only tonic that can clear out the malinvestment built up since the beginning of the fiat money era.

Here We Go Again - Stockman Warns Of August 2007 Redux

Nearly everywhere on the planet the giant financial bubbles created by the central banks during the last two decades are fracturing. The latest examples are the crashing bank stocks in Italy and elsewhere in Europe and the sudden trading suspensions by four UK commercial property funds. If this is beginning to sound like August 2007 that’s because it is. And the denials from the casino operators are coming in just as thick and fast.

Goldman Warns Of A Sharp Plunge In Stocks In "Next Few Months"

"Tactically, we continue to expect the market will experience a pullback of 5%-10% during the next few months before ending the year at 2100. Strategically, we expect a continuation of the range-bound market that has challenged investors for nearly two years. A maturing economic cycle with elevated valuations, decelerating buybacks, and growing political uncertainty provide the basis for potential market weakness in the second half."

Institutionalized Lying - Why Central Bankers Never See Bubbles

Every day there is more confirmation that the casino is an exceedingly dangerous place and that exposure to the stock, bond and related markets is to be avoided at all hazards. In essence the whole shebang is based on institutionalized lying, meaning that prouncements of central bankers, Wall Street brokers and big company executives are a tissue of misdirection, obfuscation and outright deceit. And they are self-reinforcing, too.

Janet's Jabbering Leaves Investors "On The Edge Of A Live Volcano"

The evidence that Yellen is clueless or a blatant liar is endless. The casino gamblers keep dancing on the edge of a live volcano in the belief that Yellen has their back. In fact, her statements this week prove once again that she is right there on the edge with them - jabbering incoherently. One of these days, even the silicon units in the casino will take notice. The dancing will then turn into diving for the doors.