The only ones talking "bubble" right now are the "macro bears" who hate Obama so much they have refused to buy a single stock in his presidency and have underperformed vastly.
Come on, everything everywhere is on life support by the central banks.
So you are telling me that Ben can stop QE tomorrow and the stock market would stay where it is? No way, 20% haircut at a minimum which would mean that equity holders would feel a bigger blow than the Bond market.
MRK's P/E ratio, based on 2013 EPS guidance, is about 13x—not exactly my definition of a bubble valuation.
Particularly in the context of long-term interest rates under 3%. MRK's earnings yield is around 8% - or more than double the risk-free rate. That's a long way from bubble territory.
One of the biggest misconceptions an investor can have is to look at absolute P/E's in isolation from the risk-free long-term interest rate. I see this all the time from journalists and commentator types that should definitely know better.
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