Why PE 10 Works Better In Some Markets Than Others

It is well-documented that starting valuations have been found to be highly predictive of subsequent returns, not just in the United States, but in many other equity markets around the world. One of the more popular valuation metrics for evaluating prospective returns in a given market is the ‘cyclically-adjusted price-to-earnings’ ratio, or ‘CAPE,’ developed by…

Warren Buffett on Tax Reforms, Markets & Investments

Well, valuations make sense with interest rates where they are. I mean, in the end you measure laying out money for an asset in relation to what you are going to get back, and the number one yard stick is U.S. governments. When you get 2.30 on the ten-year, I think stocks will do considerably…

How To Anticipate And Avoid Pitfalls – Howard Marks

With the stock market reaching all time highs, maybe it’s a good time to revisit Howard Marks’ memo of 2005 in which he discusses market trends being taken to excess – and the painful consequences that become clear in hindsight. Here’s an except from that memo: “The farther backward you can look, the farther forward…

The markets are falling, what are you doing?

The stock markets have been on a free fall for some time now ever since the Greek debt crisis blew up.  The Euro has been going down vis-a-vis the US dollar.  The dollar has been gaining in strength even against gold. Does that mean all is hunky dory and that all the problems are over…