Replies to post #98 on AIM UK

[lionhead0]

Hi Tom, Re: Relative Valuation..............

Thanks for the chart and explanation of the 2 factors. Yes, I agree with you as to the observation of the "flat" ranges for extended lengths of time. That would be normal for the 2 inputs on your chart. Adding additional inputs would most likely present a different picture in the final result.

P/E ratios can be forecasted somewhat based on other economic factors. I'm sure the wiz kids on Wall street have worked this all out in their computer modeling for the market makers in order to derive stock prices.

As I posted earlier, my forecast for the market is more conservative than the TV pundits and Masters of the Universe. ;) Considering the P/E at the market low, a nice countertrend rally that's developing has potential for some nice gains, but I don't expect a new bull run from here; rather the grinding sideways market for a longer period of time. If that doesn't occur, then I'll be pleasantly surprised!

We won't know the likely outcome for awhile until other factors become more apparent that will ultimately influence the P/E ratios, hence the sideways markets. In the fullness of time, we'll have the answers.

Best regards and Happy Halloween!

Tim