CAPE | The Daily Capitalist

The Most Important Thing Stock Market Investors Have to Fear Is the Lack of Fear Itself

Things have come to a pretty pass. The advance may be growing flat. I say stocks are risky. But they say that’s old hat. Goodness knows what the end will be… (Apologies to George and Ira Gershwin.)

Before Rupert Murdoch’s organization took over the WSJ and Barron’s, the latter used to be a great source [...]

Some Risk Assets Getting Frothy While the Amazing Treasury Bond Bull Market Rolls On Under Most Radar Screens

I’m not a downer all the time. I try to go where the data leads, in a risk-averse manner. If it keeps pointing in the same direction, so be it.

When I first began writing on this website in August 2010, I argued against the prevailing gloom. Recovery Summer as predicted by the advocates of Keynesian stimulus had [...]

Are U.S. Stocks “Scared Enough” Yet?

I want to make a few points briefly.

First, if you haven’t, please read Dr. Davis’ discussion of our economic data two posts below this (or click HERE). He documents that economic times remain difficult, in line with the Gallup.com polling data I have frequently referred to. He also points out how difficult it is to [...]

Smithers Updates His Stock Market Valuation Data, I Update it Further and Conclude: A Bubble May Be Forming

Momentum, liquidity, leverage, hope, etc. all move markets for variable lengths of time but ultimately value outs. One of the fundamentalists who I follow is the economist Andrew Smithers, who compiles and updates two measures of stock market value. He has now updated them based on Fed data through 12/13/11. At that time, his calculation [...]

Stocks in Extremistan As Recession Forecasts Continue

This is a long post about stocks and the economy. I hope you find it worth the effort to read it.

If there’s any doubt about the strength of economic expansions, on trend, in the United States, in the past half-century, the linked 52-year chart from the Philly Fed may help settle the issue: [...]

Updating Smithers: Continued Caution for Stock Bulls

I have frequently referred to a chart produced by a British analyst, Andrew Smithers (then click on “q and FAQs”,) who brilliantly (fortuitously) published a book in March 2000 proclaiming stocks to be in the greatest bubble in history- the very month that the NASDAQ peaked over 5100. Every three months, he updates graphically and [...]

Are U.S. Stocks Cheap?

The talking heads and promoters are mostly saying that either there will be no new recession any time soon and/or the stock market is pricing one in.

Time will tell on the first point. On the second one, an argument that is used repeatedly is that the average price-earnings ratio of the U. S. stock [...]