Comments on: Market Cap to GNP http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/ Stock Market and Investing Blog of Mebane Faber Tue, 11 Oct 2011 15:24:53 +0000 hourly 1 http://wordpress.org/?v=3.2.1 By: Monty http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-4271 Monty Fri, 06 Feb 2009 05:35:53 +0000 http://www.mebanefaber.com/?p=551#comment-4271 If you think that this market overall is worse than the late 70's, early 80's; you either have a bad memory, or you are too young to know. I am definately too young to fully understand the climate during the Great Depression, but I highly doubt we are experiencing anything like that currently. If you think that this market overall is worse than the late 70's, early 80's; you either have a bad memory, or you are too young to know. I am definately too young to fully understand the climate during the Great Depression, but I highly doubt we are experiencing anything like that currently.

]]> By: Monty http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1132 Monty Thu, 05 Feb 2009 23:35:53 +0000 http://www.mebanefaber.com/?p=551#comment-1132 If you think that this market overall is worse than the late 70's, early 80's; you either have a bad memory, or you are too young to know. I am definately too young to fully understand the climate during the Great Depression, but I highly doubt we are experiencing anything like that currently. If you think that this market overall is worse than the late 70's, early 80's; you either have a bad memory, or you are too young to know. I am definately too young to fully understand the climate during the Great Depression, but I highly doubt we are experiencing anything like that currently.

]]> By: MPC http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1126 MPC Thu, 05 Feb 2009 12:35:55 +0000 http://www.mebanefaber.com/?p=551#comment-1126 The credit markets expanded so greatly over the last twenty or so years, that I wonder if market value of equities is the right numerator. The ratio of Household Net Worth to Nominal GDP is still frighteningly high versus historic levels. The credit markets expanded so greatly over the last twenty or so years, that I wonder if market value of equities is the right numerator. The ratio of Household Net Worth to Nominal GDP is still frighteningly high versus historic levels.

]]> By: steve http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1125 steve Thu, 05 Feb 2009 11:39:03 +0000 http://www.mebanefaber.com/?p=551#comment-1125 I fail to understand how that chart can be construed to give the signal that stocks are "screaming buys" and "opportunities of a liftime". especially given that our economy is clearly in worst shape now than anytime other than 1930's. seems to me, stocks are overpriced given this data and we should wait to see tham trading at under 50% of GDP. NO? I fail to understand how that chart can be construed to give the signal that stocks are “screaming buys” and “opportunities of a liftime”. especially given that our economy is clearly in worst shape now than anytime other than 1930's. seems to me, stocks are overpriced given this data and we should wait to see tham trading at under 50% of GDP. NO?

]]> By: Matt http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1124 Matt Thu, 05 Feb 2009 03:16:32 +0000 http://www.mebanefaber.com/?p=551#comment-1124 Don't you need to normalize for the amount of GNP contributed by public companies? I assume that the ratio of public to private companies has gone up whish would explain at least somewhat the systematic increase this ratio over time. Although I certainly agree that it seems far from an obvious buy signal...but you really only need to look at historical aggregate P/E to see that...much more direct, no? Don't you need to normalize for the amount of GNP contributed by public companies? I assume that the ratio of public to private companies has gone up whish would explain at least somewhat the systematic increase this ratio over time. Although I certainly agree that it seems far from an obvious buy signal…but you really only need to look at historical aggregate P/E to see that…much more direct, no?

]]> By: Don Hole http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1122 Don Hole Thu, 05 Feb 2009 00:50:30 +0000 http://www.mebanefaber.com/?p=551#comment-1122 It's all LIES!!!!!! <br><br>AAAAAAAAAIIIIIIGGGGGHHHHHHHH!!!!!! It's all LIES!!!!!!

AAAAAAAAAIIIIIIGGGGGHHHHHHHH!!!!!!

]]> By: Carl http://www.mebanefaber.com/2009/02/04/market-cap-to-gnp/comment-page-1/#comment-1121 Carl Wed, 04 Feb 2009 21:24:04 +0000 http://www.mebanefaber.com/?p=551#comment-1121 The chart reconciles nicely with a study on Hussman Funds site which notes that historically the market traded between .7 and 1.0 Price to Sales in bear/bull markets. Strong bear markets dropped as low as .4/.5 but more often to the .6/.7 range. So.... where might that suggest we are going? The chart reconciles nicely with a study on Hussman Funds site which notes that historically the market traded between .7 and 1.0 Price to Sales in bear/bull markets. Strong bear markets dropped as low as .4/.5 but more often to the .6/.7 range. So…. where might that suggest we are going?

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