Poll on S&P 500 downside targets. 5 days ago I started a poll listing downside targets of 880 820 600 and 200. 880 was by far the leader, especially as the market tanked Monday, then as the week progressed and the market inched and lurched up, the 820 started gaining in popularity, and 600 and 200 both gained in percentage on the 880. OK riddle you this....Why?. As we see loftier levels of P/E ratio, perhaps people think there is a larger price to pay for overexuberance. See screen cap.
http://screencast.com/t/rbBlUb9P8
Take the poll yourself if you wish, there is 22 hours left.
I'll discuss P/E in a later post and how Wall Street is completely disregarding reality. "Reported Earnings" are in a basic sense the ones that CFO's will be in trouble if they lie about. Operating earnings are the ones that happen when Goldilocks lies about how the one time porridge stealing will never happen again, and a porridge in every bowl and a chicken in every pot will keep growing perpetually, even though we were hungry last year and hungrier now. Operating earning exclude...well...all the bad stuff that companies want to pretend were relating to just one year or one event.
Fundamentals do matter on a long term basis. But don't bet July or August options based on fundamentals.
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Insightful and Useful Comment!