Quote:
Originally Posted by NajdorfDefense
It is a relationship that may or may not be correlated in the future. If you wait for the SPX to fall to 6x PE like prior bottoms, or hundreds of banks to fall to 0.1x book like prior downturns, you will likely be dead before you invest.
Other than saying 'Lower prices are better,' I'm not sure such graphs add anything of value whatsoever. It is a good reminder that prices can go lower, if you still need one.
Its also relatively trivial to data snoop something that vaguely fits considering the mountains of financial ratios/commodities/etc that are in the world. You can even sprinkle in random multiples to help data snoop graphs.
If only they had real value.