Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 07-04-2008, 03:42 PM   #81
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,695
Some PE's trailing and estimated: P/Es & Yields on Major Indexes - Markets Data Center - WSJ.com
__________________

__________________
Lsbcal is online now   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 07-04-2008, 03:51 PM   #82
Full time employment: Posting here.
 
Join Date: Jan 2008
Posts: 798
Quote:
Originally Posted by lsbcal View Post
There seems to be a disconnect. I think the difference must be between trailing, estimated, and current earnings. Many DOW companies are reporting loses, I'm not sure if that is being counted as zero or if all the earnings are being added together, negative or otherwise, to get 90?
__________________

__________________
RockOn is offline   Reply With Quote
Old 07-04-2008, 03:58 PM   #83
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,695
Whatever the reason for the trailing PE, the market will trade on estimated PE. But the estimate is based on the sum total of individual perceptions and not on a published guess by analysts. Of course, we are all entitled to our own guess.
__________________
Lsbcal is online now   Reply With Quote
Old 07-04-2008, 04:00 PM   #84
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,613
Quote:
Originally Posted by RockOn View Post
There seems to be a disconnect. I think the difference must be between trailing, estimated, and current earnings. Many DOW companies are reporting loses, I'm not sure if that is being counted as zero or if all the earnings are being added together, negative or otherwise, to get 90?
There are a few different mechanisms, I think. IMO, the bottom line remains that a weak economic environment that depresses earnings makes P/E a fairly useless measure of market valuation. And *estimated* P/E looks at the next 12 months, but these vary from one analyst to another.

The only way I know of to reliably use P/E as an indicator is this: When the stock market is near record highs and P/E is at nosebleed levels, the market is probably overvalued, and likely severely so. (See early 2000.)
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 07-04-2008, 04:14 PM   #85
Thinks s/he gets paid by the post
ladelfina's Avatar
 
Join Date: Oct 2005
Posts: 2,713
Sorry, I should have posted a link.
BigCharts - QuickCharts
__________________
ladelfina is offline   Reply With Quote
Old 07-04-2008, 07:13 PM   #86
Moderator Emeritus
Nords's Avatar
 
Join Date: Dec 2002
Location: Oahu
Posts: 26,620
Quote:
Originally Posted by lsbcal View Post
Whatever the reason for the trailing PE, the market will trade on estimated PE. But the estimate is based on the sum total of individual perceptions and not on a published guess by analysts.
I'm goin' with the "big bath" theory.

Whenever an executive has a poorly-performing sector or two, they naturally hesitate to air their issues until absolutely required by securities law. (And maybe not even then.) They may perhaps be tempted to disguise how bad some part of the company is really doing until they have a chance to slap some lipstick on it turn it around and put it up for sale.

Until the economy goes bad.

Then it's a free confessional with no penance, no remorse, and all the absolution you want! "Forgive me, stockholders, for I have sinned. The economy took away $100M of our profits, but we're going to boost it to $500M by marking down of all the other crap that's been stinking up the balance sheet for the last six quarters assets also just impaired by this dire recession."

I wish I could remember the link, but I read a claim that bank's declared subprime losses have exceeded the size of the subprime market. Brewer, any whiff of veracity to that rumor?

It's interesting that this appears to be a consumer-led recession instead of an unemployment recession or an inflation one. But the world is filled with wannabe consumers, not just in the U.S., and a consumer recession seems a lot easier for a multinational to recover from than unemployment or inflation.

Fidelity's portfolio X-ray tool claims that our ER portfolio is nearly 50% financials. When the "big bath" is over, I'm pretty sure that the financials will be standing by to suck up all the commissions & fees help everyone get back on their feet through consolidations, acquisitions, and IPOs.
__________________
*
*

The book written on E-R.org, "The Military Guide to Financial Independence and Retirement", on sale now! For more info see "About Me" in my profile.
I don't spend much time here anymore, so please send me a PM. Thanks.
Nords is offline   Reply With Quote
Old 07-04-2008, 07:22 PM   #87
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,487
i think the "big bath" theory hold water. whenever there's some external bad news, it's a great time to blame that for many problem hidden under the rug.
__________________
d is offline   Reply With Quote
Old 07-04-2008, 08:24 PM   #88
Recycles dryer sheets
 
Join Date: Apr 2006
Posts: 143
Quote:
Originally Posted by d View Post
i think the "big bath" theory hold water. whenever there's some external bad news, it's a great time to blame that for many problem hidden under the rug.
There is also the unwritten rule on Wall Street that when a company has bad news to report (whatever the cause), it's best to lump it all into one really bad quarter and get it out of the way.

When management blames the company's problems on everything else except themselves, however, that is sometimes a red flag for investors to stay away. While many events are outside the control of management, good managers are candid with their investors and accept the blame when they are the ones who screwed up in the first place (Warren Buffett is good about doing this whenever Berkshire Hathaway has a bad year, for example).
__________________
rogersteciak is offline   Reply With Quote
Old 07-04-2008, 08:31 PM   #89
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
brewer12345's Avatar
 
Join Date: Mar 2003
Posts: 16,391
Quote:
Originally Posted by Nords View Post
I wish I could remember the link, but I read a claim that bank's declared subprime losses have exceeded the size of the subprime market. Brewer, any whiff of veracity to that rumor?
Wouldn't surprise me, although its the first I have heard of it. The actual subprime mortgage market wasn't that big. Could also be sloppy attribution by the media. Company XYZ write down $1 billion on a CDO squared (if you don't know what is is, consider yourself lucky), is is a subprime loss? Who knows.
__________________
"There are three kinds of men. The one that learns by reading. The few who learn by observation. The rest have to pee on the electric fence for themselves."



- Will Rogers
brewer12345 is offline   Reply With Quote
Old 07-04-2008, 10:03 PM   #90
Thinks s/he gets paid by the post
 
Join Date: Jun 2005
Posts: 1,543
Quote:
Originally Posted by Nords View Post
I'm goin' with the "big bath" theory.

Whenever an executive has a poorly-performing sector or two, they naturally hesitate to air their issues until absolutely required by securities law. (And maybe not even then.) They may perhaps be tempted to disguise how bad some part of the company is really doing until they have a chance to slap some lipstick on it turn it around and put it up for sale.

Until the economy goes bad.

Then it's a free confessional with no penance, no remorse, and all the absolution you want! "Forgive me, stockholders, for I have sinned. The economy took away $100M of our profits, but we're going to boost it to $500M by marking down of all the other crap that's been stinking up the balance sheet for the last six quarters assets also just impaired by this dire recession."

I wish I could remember the link, but I read a claim that bank's declared subprime losses have exceeded the size of the subprime market. Brewer, any whiff of veracity to that rumor?

It's interesting that this appears to be a consumer-led recession instead of an unemployment recession or an inflation one. But the world is filled with wannabe consumers, not just in the U.S., and a consumer recession seems a lot easier for a multinational to recover from than unemployment or inflation.

Fidelity's portfolio X-ray tool claims that our ER portfolio is nearly 50% financials. When the "big bath" is over, I'm pretty sure that the financials will be standing by to suck up all the commissions & fees help everyone get back on their feet through consolidations, acquisitions, and IPOs.
subprime is just a catchy phrase to lump everything together. i've read of Alt-A loans going bad at very high rates as well as prime bonds with double digit foreclosure rates
__________________
al_bundy is offline   Reply With Quote
Old 07-04-2008, 10:49 PM   #91
Thinks s/he gets paid by the post
 
Join Date: Sep 2006
Posts: 1,695
Quote:
Originally Posted by Nords View Post
I'm goin' with the "big bath" theory.


I wish I could remember the link, but I read a claim that bank's declared subprime losses have exceeded the size of the subprime market. Brewer, any whiff of veracity to that rumor?

Would seem extremly unlikely In 2006 alone the subprime loan total was 600 billion, so total market must be well over a trillion dollars

Subprime lending - Wikipedia, the free encyclopedia

And subprime auto loans were 50 billion in 2006


Subprime Auto Loans Hit $50 Billion in 2006
__________________
Running_Man is offline   Reply With Quote
Old 07-05-2008, 08:31 AM   #92
Thinks s/he gets paid by the post
ladelfina's Avatar
 
Join Date: Oct 2005
Posts: 2,713
al, I agree. "Subprime" is a catch-all.
Shhhh, though... we're not supposed to think about prime bonds with high foreclosure rates -- don't ask, don't tell!!! We are "lucky" not to know!

hah.. reminds me of this:
Quote:
"I know what you're thinking. Did he write down six hundred billion or only five? Well, to tell you the truth, in all this excitement I kind of lost track myself. But being as this is LTCM universe, the most unregulated, over-leveraged financial system in the world's history, and would blow your real assets clean off, you've got to ask yourself a question: Do I feel lucky? Well, do ya punk?"
__________________
ladelfina is offline   Reply With Quote
Old 07-05-2008, 05:03 PM   #93
Recycles dryer sheets
barbarus's Avatar
 
Join Date: Aug 2007
Posts: 433
Ladelfina, you've got a tough row to hoe, trying to convince this lot to exhibit anything less than starry-eyed optimism. I find the overall attitudes in this joint vis--vis the current situation frustrating but also a useful barometer of the fantasies held by the American upper-middle class.

Would you do something for me?
Just keep your posts organized in your memory and wait until next summer. On the 4th of July in '09, resurrect the responses your getting now and grind their noses in it.

All in the spirit of good clean fun of course. Gemutlikeit!

Note how many respondents will be emitting phrases like:

"Ya, but this is different" or "Well, nobody could have foreseen THAT" or "Things have changed". They'll be quite furious that you were correct. Some will flat out deny they said what will be here in black & white. Others will try to twist the meanings of their former statements politician-style.

Most will be just, plain scared and desperately grasp at straws, trying to convince each other that a return to good times is imminent.

You (and I) will gain some small satisfaction at having applied logic, depth of analysis, and dispassionate perception to some rather obvious conditions.
Then the average yobs will burn us at the stake.
__________________
Consult with only myself as your adviser or representative. My thoughts should be construed as investment advice of the highest caliber. Past performance is but a pale shadow and guarantee of even greater results in the future.
barbarus is offline   Reply With Quote
Old 07-05-2008, 05:44 PM   #94
Thinks s/he gets paid by the post
 
Join Date: Dec 2007
Posts: 4,764
Quote:
Originally Posted by barbarus View Post
Ladelfina, you've got a tough row to hoe, trying to convince this lot to exhibit anything less than starry-eyed optimism. I find the overall attitudes in this joint vis--vis the current situation frustrating but also a useful barometer of the fantasies held by the American upper-middle class.

Would you do something for me?
Just keep your posts organized in your memory and wait until next summer. On the 4th of July in '09, resurrect the responses your getting now and grind their noses in it.

All in the spirit of good clean fun of course. Gemutlikeit!

Note how many respondents will be emitting phrases like:

"Ya, but this is different" or "Well, nobody could have foreseen THAT" or "Things have changed". They'll be quite furious that you were correct. Some will flat out deny they said what will be here in black & white. Others will try to twist the meanings of their former statements politician-style.

Most will be just, plain scared and desperately grasp at straws, trying to convince each other that a return to good times is imminent.

You (and I) will gain some small satisfaction at having applied logic, depth of analysis, and dispassionate perception to some rather obvious conditions.
Then the average yobs will burn us at the stake.
That is the scariest post Ive ever read on these boards. Not even ***** either..

The starred thing was the H word. Sorry gave myself 40 lashes for my insolence..
__________________
Notmuchlonger is offline   Reply With Quote
Old 07-05-2008, 05:48 PM   #95
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,695
Quote:
Originally Posted by barbarus View Post
Ladelfina, you've got a tough row to hoe, trying to convince this lot to exhibit anything less than starry-eyed optimism. I find the overall attitudes in this joint vis--vis the current situation frustrating but also a useful barometer of the fantasies held by the American upper-middle class.
...
This current situation could get a lot worse. Using FIRECalc I find that from 1910 - 1974 a portfolio with my AA and spending patterns would have a median low point 1/3 lower then I started this year with. So half of those periods would be even worse. With only about 8% decline YTD(spending and portfolio declines) this could be a many year process. But unfortuneately we all have to play the game. The situation could reverse too, who knows?

On the other hand, those FIRECalc simulations included 2 world wars, a great deflation, a great inflation, etc. Barbarus, I don't know what you mean by starry-eyed optimism. I'm trying to see the situation as dispassionately as I can because none of us knows the future.
__________________
Lsbcal is online now   Reply With Quote
Old 07-05-2008, 06:37 PM   #96
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
cute fuzzy bunny's Avatar
 
Join Date: Dec 2003
Location: Losing my whump
Posts: 22,697
I think I'm a little more in the camp of not freaking out over something thats happened a few dozen times in my lifetime and will happen a few dozen times more.

Since its been well proven that you cant time the market other than to throw money in when its visibly ridiculously cheap or pull money out when its visibly ridiculously overvalued...your options are to play a reasonable hand and its associated reasonable odds.

If you think the sky is falling ever time theres a bear market, you'll eat yourself up or play too conservatively and lose just as badly. It'll just take longer.

What fascinates me is why people with an obvious disdain for the collective community continue to waste their productive efforts with us.

But then again I still cant figure out how a community of people who invest in wildly different manners, in drastically different products and asset classes, and with widely varied opinions can ever be balled up into some borg-like lump to be criticized.
__________________
Be fearful when others are greedy, and greedy when others are fearful. Just another form of "buy low, sell high" for those who have trouble with things. This rule is not universal. Do not buy a 1973 Pinto because everyone else is afraid of it.
cute fuzzy bunny is offline   Reply With Quote
Old 07-05-2008, 06:51 PM   #97
Thinks s/he gets paid by the post
 
Join Date: Apr 2006
Posts: 1,487
sometimes the "writing on the wall" is just graffiti
__________________
d is offline   Reply With Quote
Old 07-05-2008, 07:11 PM   #98
Thinks s/he gets paid by the post
 
Join Date: Dec 2007
Posts: 4,764
Quote:
Originally Posted by d View Post
sometimes the "writing on the wall" is just graffiti
Or monkey flinging poo to make something that looks like writing..
__________________
Notmuchlonger is offline   Reply With Quote
Old 07-05-2008, 07:33 PM   #99
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,613
Quote:
Originally Posted by barbarus View Post
Ladelfina, you've got a tough row to hoe, trying to convince this lot to exhibit anything less than starry-eyed optimism.
Yup. Again -- lovely to see those who are 100% convinced we're f****d accuse those of us who think it MIGHT not end worst case as being Pollyannaish "starry-eyed" optimists.

Let me ask you something. How many people here have said we're at the bottom and it's all up from here?

How many people here have claimed that there aren't significant economic issues that could be a headwind in the months (or years) to come?

How many people here have been ignoring some of the very real economic conditions that has led to a bear market since the October highs?

To my recollection, the answers are ZERO, ZERO and ZERO.

So I think claiming to see "irrational exuberance" is two tacos short of a combo plate. In your world, it would seem that ANYTHING other than seeing that we're doomed is "starry-eyed optimism."

Nice.

You may be right just as well as others -- hell, you may even be more likely than not to be right -- but I'll save yours, too -- and on the off chance that you're wrong, I'll looking forward to rubbing your nose in it. The thing is, if it goes down farther, you have no noses to rub into it yourself because no one here has been predicting an imminent reversal, just that we can't predict the future and that *historically*, bear markets reverse in 12-15 months. YOU are the one who are acting omniscient about the future, and if you are wrong, enjoy the embarrassment. I've seen no one here claiming we're on the verge of going higher, or that things won't get worse before they get better.

I've ONLY seem the doomsday crowd acting like they KNOW the future.

I swear, I am SICK and TIRED of people acting like there are only two possible takes on the economy, Pollyanna and Doomsday. Consider this the straw that broke the camel's back.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 07-05-2008, 07:45 PM   #100
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Dawg52's Avatar
 
Join Date: Feb 2005
Location: Central MS/Orange Beach, AL
Posts: 7,442
Quote:
Originally Posted by ziggy29 View Post
Yup. Again -- lovely to see those who are 100% convinced we're f****d accuse those of us who think it MIGHT not end worst case as being Pollyannaish "starry-eyed" optimists.

Let me ask you something. How many people here have said we're at the bottom and it's all up from here?

How many people here have claimed that there aren't significant economic issues that could be a headwind in the months (or years) to come?

How many people here have been ignoring some of the very real economic conditions that has led to a bear market since the October highs?
Oh come on now, you must have forgot about old optimistic me. BTW, you've got to come out of your shell.
__________________

__________________
Retired 3/31/2007@52
Full time wuss.......
Dawg52 is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Another perspective on calorie restriction Nords Health and Early Retirement 7 09-05-2007 04:25 PM
TexasGal ERing now, looking for perspective/help TexasGal Hi, I am... 7 07-25-2007 11:14 PM
A different perspective on job-hopping Nords Young Dreamers 19 07-24-2006 10:33 PM
Mortgage from a different perspective sgeeeee FIRE and Money 6 02-20-2006 11:36 AM

 

 
All times are GMT -6. The time now is 10:06 AM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.