Slope of Hope Blog Posts

Slope initially began as a blog, so this is where most of the website’s content resides. Here we have tens of thousands of posts dating back over a decade. These are listed in reverse chronological order. Click on any category icon below to see posts tagged with that particular subject, or click on a word in the category cloud on the right side of the screen for more specific choices.

Mr. Wizard’s Epic Post (2 of 3)

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Here is a link to Part 1

Shiller S&P Trendline from 1871

If we plot all of the data, we see that current fair value for the S&P is around 1373, which gives us a overvaluation factor of 2.8, or 181%. The S&P hasn’t been in the 1300s for more than 10 years, that’s like the Dark Ages for many of today’s traders. In 10 years fair value by that trendline will be 2161. The S&P needs to drop relentlessly, year after year, for 10 years, to get to that 2161 target in the year 2032. Ludicrous, right? Fortunately, we can turn off ludicrous mode very simply. How? Adjust the data. Which takes us to…………