The Casey Report: Lies, Damned Lies, and Price/Earnings Ratios - Dan Steinhart, Managing Editor

 
As John Hussman, President of Hussman Funds will explain, the PE ratio is merely one data point. And in this case, it's wildly misleading. The rest of the data is nowhere near as rosy.
 
For example, corporate profit margins are a mind-numbing 70% above their historical norms. Profit margins are cyclical—meaning they will decline and undercut earnings. Margins can only go down, and it's a long drop back to the mean.
 
You'll read about that and several other sobering stock market statistics in today's guest article, which is part of John Hussman's Weekly Market Comment series. You'll also find John's well-reasoned projection for stock market returns for over the next 10 years. Fair warning: it's not pretty

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