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Stock Market -- Fundamentals

Posted on September 23, 2008

The SP 500 Market Tracker has dropped further in Sept. and isnow at 1025 fair value based on 12 month earnings and inflationreadings. The earnings index has fallen from an annual rate ofaround 90.0 in mid-2007 to 69.0 presently. The vast bulk ofthe carnage has been in the financial sector, but as productiongrowth slows globally, more sectors have been implicated. Thep/e ratio for the Tracker has contracted as well over this periodas inflation accelerated sharply until just recently (Risinginflation raises the investment hurdle rate and suppresses themarket multiple).The SP 500 is trading at ar...

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earnings , economy , inflation