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Is This a BUBBLE or am I Deceived?

April 27, 2017

As of April 27, 2017, the follow Price/Earnings ratios prevail (source WSJ):

  1. Dow Industrial:   20.91 vs year ago of 18.82 vs average of 17.60
  2. Dow Transportation:   19.03 vs year ago of 12.66 vs average of 16.12
  3. Dow Utility:  41.10 vs 21.44 year ago vs average of 19.22
  4. Russel 2000:  107.89 vs nil year ago vs average of 19.23
  5. Nasdaq 100:  26.01 vs 22.58 year ago vs average of 20.37
  6. S & P 500:  24.39 vs 24.11 year ago vs average of 18.24

The current BUBBLE is substantial and it will BURST at some point. When? Not until the Central Bank trading desks choose a date for EXIT. The game of money can continue as long as general confidence continues. Today, Central Bank trading desks pump up our markets as an implosion will not be allowed.

Money is a ‘confidence’ game and when the opium within the system evaporates, then the burst will occur. It could be tomorrow, the next day, or many days into one’s future. The fun and excitement can continue until it ends. Enjoy the ‘calm’ before the eventual ‘storm’! Read my prior missive on Trump’s Tax Policy! D

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