Zeev's Turnips Patch-No Politics (ZEEV)

[mlsoft]

michael...

As you surmised, this has been a very unusual market - unprecedented in many ways. That is because it has been driven not by fundamentals or normal market forces but instead by government policy - that has never happened before.

You are also correct that when making comparisons, you should compare apples to apples. When comparing historical PE's, for instance, not only are they now at extreme bubble levels from a historical perspective, but the advent of "pro-forma", "EBITDA", and other creative and fictitious earnings garbage is a relatively recent phenomenon, and never has it been as pervasive and blatant as now. There is no real basis for comparison unless you go into the 10-Q's and use the numbers companies report to the SEC -- and when you do that, the comparisons become astronomical.

As for using old charts, I never put any faith in anything older than 1 year, although I do look at 2 year charts from time to time. Even at a year old, often the situation is so different that the charts can be very misleading, so the best ones are those for 6 months or less. A lot of folks would disagree, but that is the way I use them. An exception is that almost every bubble aftermath has followed a pattern that is so consistent that it is hard to ignore, so I keep those in mind as we unwind from the recent bubble (and right back into another one.)

Good luck to you.

mlsoft