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Randoms: Is P/E Price Earnings or Public Enemy?


Don't believe the hype.


Editor's Note: The following was posted in real time on our premium Buzz & Banter (click for a free trial). It's being shared here for the benefit of the Minyanville community. See also Make or Break for the Market and Bank on this Rally?

Punky Brewster? - 10:45 am

It may be something, may be nothing--and could be a pterodactyl--but I would draw your attention to the laggy action in JP Morgan (JPM), Goldman Sachs (GS), Wells Fargo (WFC) and Morgan Stanley (MS), all of which are scratching for pennies from heaven.

I see and respect the breadth (5:1 positive) but the piggies feel like they wanna poke lower and if that happens, it could be a game changer. That, and the proximity to S&P 950, are cause for paws in the midst of this circle smirk.

See both sides, Minyans, always see both sides.

Answers I Really Wanna Know... - 12:38 pm

  • Does anyone else sense that a seismic currency adjustment is edging closer to reality?

  • While we learned a lot by watching (the banks) this morning, will Hoofy return serve and point to the (still 2:1 positive) internals as a hindsight proof point of the stubbornly sticky tape?

  • As I'm in "hit it to quit it" mode and plan to take vacation with a flat pad and fresh head, does discipline dictate covering some of my "opening fades?" (Yep.)

  • And slapping trailing stops on my remaining leaves? (Yep.)

  • Why do I get the sense that I'm gonna miss mas excitement in the marketplace?

  • Y'all see my boy Melo go off for 39 last night and man up on Kobe?

  • As friction between opinions is where true education lies, isn't it great to read Soon-to-Be Professor James Kostohryz's take on Bank America (BAC) being a $40 stock?

  • On the other hand, would you really be that shocked if this turned out to be a double top in the S&P directly below the 200-day moving average?

  • Trade options? Why not take a free trial of Steve Smith's excellent options product, OptionSmith?

  • Why do I channel Biggie every time I think of Cali?

  • Is anyone else gonna be really psyched when Mercury Retrograde passes through?

  • Did you really think the market was gonna crash when everyone thought it would in March?

  • Is it possible that I already miss Minyanville?

Minyan Mailbag: Phoning Homes - 2:09 pm


Have a great vacation. I have put off writing a book for sometime as I have several topics in my head ranging for starting/building a business, dealing with customers, and profiles of Montessori kids along with the impact of the education on their lives. I have tremendous respect for someone following through and getting it done. That said I can't wait to read yours. One question, since I am still somewhat new to the 'ville, have you guys considered having a conference somewhere during the year. It would be great to meet with other like minded traders to share ideas and forge relationships.

-Minyan Don


Thank you kindly, sir. Memoirs has been brewing in my head and worked on behind the scenes (in my spare time!) the last several years. We received an offer to publish it but I decided to "zag" and release it as an e-Book in eighteen weekly installments. While most of the story has never been told in public or private, there is more "there" there that will be included in a traditional book when the time comes.

Given the current social mood and mainstream societal acrimony, I'm unsure what the public response will be. There will invariably be folks who will scream "As part of Wall Street for so long, YOU created this mess and you deserve bad things to happen to you and your family!" (True story! I once read that on the message boards when I used to peruse them).

That, however, is missing the overarching theme: The false idolatry of money, the caveats of chasing the cash register, the personal introspection that net worth doesn't dictate self-worth and staying true to who you are against monstrous odds. Indeed, it's my sincere hope that by sharing my missteps, misconceptions and mistakes, others will be able to avoid them entirely.

In terms of events, we used to host an annual Minyans in the Mountains retreat each summer where our human capital commingled for content, sporting events (Minyan softball was killer) and ranch parties complete with Grateful Dead bands.

Entering 2007, the decision was made that a high-end retreat would be poor form in front of (what we perceived to be) the coming recession. Instead, we shifting our energies to NYC holiday gatherings that raised money for the RP Foundation in the good name of my grandfather. A lot of kids benefited from that decision and it remains a mainstay Minyanville event.

Check out the links below when you've got a moment and know we're currently weighing our next event with an eye towards getting the band back together. Thank you for your newfound Minyanship and, if you believe in what we do and how we do it, please help us spread the good word for that's how we grow.


P/E: Price-Earnings or Public Enemy? - 2:35 pm

  • "Toddo, I just finished reading the latest issue of Elliot Wave Theorist. Towards the end, it offers that "Every bear market bottom of the past 100 years sported a P/E ratio of 6 or 7, which is 90 percent below the ratio's current level, the highest disparity ever." That's the musing you had yesterday?" In a word, yes, although I wasn't aware of that report when I said it.

  • In the "Updates R' Us" Department, I've covered my fades (sales) from the early morning circle smirk and have tight stops on my soon-to-be-gone-and-forgotten leaves. While part of my motivation is that I'll soon be outie like Cher Horowitz, relative balance is prudent given our competing tells (fugly banks and snazzy breadth).

  • What's my take udder wise? Humble, and out there.

  • Bank America (BAC). Super tell. See it, even if you're not trading it please.

  • Do you believe your name and word still mean something and honesty, trust and respect are the foundational constructs of any successful endeavor? If the answer is "Hell Yeah!," you've got what it takes to be in the Minyanville Underground Railroad.

  • I've been a slacker of late with regard to that initiative but we'll soon make it up to Ye Faithful Ambassadors by offering beta testing privileges on some snazzy roll-outs and maybe, just maybe, first draft privileges of the upcoming Memoirs.

  • Wanna get involved? It's always free to be you and me.

  • Anyone wanna venture a guess how many emails will be waiting in my inbox when I return from vacation next Sunday night? Heck, we'll pull together a healthy array of Critter Schwag for the Minyan who picks the closest number without going over!

  • Fare ye well, Minyans, and good luck as we truck through the muck!


Position in financials
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