Shiller P/E just exceeded 40 for the first time since 1999, the only other time it has happened in history

S&P 500 is now 40 times the average inflation-adjusted earnings from the previous 10 years, known as the Cyclically Adjusted PE Ratio (CAPE Ratio).

This value is now 92% as high as it was in the peak of the 2000 tech bubble.

https://www.multpl.com/shiller-pe

How this is computed:

1. Look at the yearly earning of the S&P 500 for each of the past ten years.
2. Adjust these earnings for inflation, using the CPI (ie: quote each earnings figure in 2021 dollars)
3. Average these values (ie: add them up and divide by ten), giving us e10.
4. Then take the current Price of the S&P 500 and divide by e10.

Submitted November 05, 2021 at 09:40AM by ConvergenceMan https://ift.tt/3GRE6Zn