Invesco QQQ Trust Series 1 (QQQ)

[DragonBits]

Roy, I don't think a lot lower is the way to think of it. The SPY is already down 18% from its high, so eventually down another 7-12% isn't a lot lower. The IWM is down 20%; another 10% isn't a huge amount lower.

If we enter a period of 2-5 years of slow growth, what would be the proper PE for growth stocks? Maybe something like 12-20?

And the market doesn't have to drop that much, what also could happen is that we stay in this trading range several more years. Maybe a little lower range. And if we do hit those sorts of lows it could be in late 2009.

I think the housing slowdown and debt problems take a long time to resolve and leave a lasting impression on spending.

Correct me if I am wrong here, but if farooq is right and the war in Iraq ends soon, the troops come home and unemployment will soar. Oil may well fall and energy stocks will also fall. Defense stocks will fall. If tensions decrease won't gold and some commodity stocks also fall? I doubt all this will cause the financial sector to soar.

In the 70-74 market, the Vietnam War ended and USA troops were withdrawn on March 1973. Using the SPY index, after the May 70 market bottom of 68.61, the market then peaked at 117.37 in Dec 72, and dropped to 64.40 in Dec 74. After that we had another big rally.

Aren't wars are generally considered a big fiscal stimulus since it causes higher employment and higher GOV spending? So isn't the immediate after affects of ending a war a winding down in spending and a repayment of debt?

Mostly thinking about Japans’ market reactions to the bursting of their RE bubble, and the USA reactions to ending the Vietnam war, and the past cycles of recoveries from huge bear markets. Meaning our 2000-2002 was a huge bear market followed by a huge recovery which should be followed by a lesser bear market. But bear markets are at least 20% down.