Many are concerned about the high P/E Ratio of the market, but I don't think it's as concerning as it seems. Earnings are temporarily down due to covid, which results in a higher ratio, but assuming the economy opens up after enough people have been vaccinated, earnings should go way up as people stop saving and start spending. Savings rates are at an all time high, but I think we all know that will end once things open up again. Most consumers who have saved more in the past year will be eager to spend more once they're comfortable doing so. Isn't it safe to assume earnings will go up when savings rates drop?
The S&P's highest P/E Ratio occurred in early 2009, which was literally the best time to buy stocks in our lifetimes thus far.
Submitted January 18, 2021 at 10:38PM by NastyNas0 https://ift.tt/3p2tD44
