Another quarter down, which means we can once again assess where the forward P/E multiple of the S&P stands relative to the previous two market bubble peaks.
- the good news: at 16.2x, the S&P still has about 9x P/E turns to go before it hits the 2000 dot com bubble peak.
- the bad news: at 16.2x, the S&P it is precisely 1x P/E turn above the peak 2006/7 housing bubble.
But perhaps what is most notable is that from its 2009 lows, the S&P is,or rather was as recently as a week ago, up some +204%. This is essentially the surge in the market from the dot com bubble (+106%) and the housing bubble (+101%) combined. It goes without saying that all the "gains" from the past two bubbles were transitory and were all lost during the bubble bursting phase.