Despite the summary above and his bearish commentary, Shiller does make the case that one should be buying into the weakness in the markets and that one should be careful. Interestingly he says that equities are overvalued, but not by alot in historical terms. I make my own graphs using his data from the site http://www.irrationalexuberance.com/. The correlation of long term P/E's to equity performance is remarkable. It is tough to discern if stock prices lead to long term P/E declines or the other way around here, but the linkage is quite obvious. Did I mention that we are in a recession?
GOATMUG
Goatmug is an investor that cares about you and your family. Goatmug's Blog - Financial Perspectives From The Mountain Top is a collection of thoughts on our economy and how it impacts the lives of investors and average people. While several specific investments are named in many of his posts, these articles are simply invitations for you to do your own research and reference to these securities does not constitute financial advice. Your situation is complex and unique and you should seek professional assistance with your trading and investing. Please visit Goatmug and share your comments at http://www.goatmug.blogspot.com/