Barron’s Gives Reasons Why Market is Close to the Bottom

By on March 13, 2009

The latest issue of Barron’s magazine listed several signs indicating the stock market is cheap. 1) Equity PEs are low in relation to yields on treasury bonds; 2) The stock market as a percentage of GDP is at 60%, which is the lowest in over 15 years; 3) The S&P 500 is about 75% of the price of an ounce of gold versus an average 160% over the last 40 years; 4) there is $4 trillion of cash on the sidelines equating to about 1/2 the market cap of the U. S. stock market, which is twice as much as two years ago.


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