PE Ratio – Mania v Panic

by Martin Armstrong
Armstrong Economics

QUESTION: Hi Mr. Armstrong,

Some of your readers, me included, wonder how the Dow is going to get to 23,000 or more, especially as we go through an economic slowdown. This would suggest a P/E of around 23 or higher. Is the common thinking that would accompany such a move similar to past manias (tulipmania, south sea bubble)? Is mania thinking also cyclical?

Thanks as always, M

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