Thanks to Jonathan Chevreau of the Financial Post and his Wealthy Boomer blog for posting our recent interview on Juggling Dynamite and why I am a pragmatist, “NOT A PERMA-BEAR!” Click and see for yourself.
I will be a bull again in the future. I do have a sense of humour. I am fun at parties. Honest.
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On the interview with Jonathon Chevreau – you go girl! You are 200% correct in your comments & thank you for clearly stating them.
As an accountant I'm on the forefront seeing what isn't posted economically anywhere yet – but a large decline in business activity, debt accumulation beyond what can likely be repaid and assumptions that the past is going to equal the future (hence why a p/e ratio does not work as you eluded to!!)
Your next book needs to be the reality of the decoupled results of stock indexes from true economic activity and truly sustainable models – growth is not sustainable in a world of finite resources!
You are right in your secular approach and your savy in realizing future earnings won't and quite frankly can't match the past – or we'll need to change the name 'Earth' to “Big Easter Island” and at some point we'll all see the last tree or last drop of clean water be used.
Stock markets and for that matter any assurance based financial stmt. is estimated to be missing up to 80% of the true costs of its activities. Carbon disclosure leading to carbon pricing will correct some of that. Where is that in the P/E ration however our survival on earth depends on it?
I would suggest that your approach is correct and further adding credence to your comments on the “E” in P/E is that the “E” will be and has to be very different going forward – hence yes the markets I believe are still way, way overpriced.
Keep up D with your great ethical work of spreading the truth on how financial markets/incentives work! And yes….I know you are lots of fun!
Thanks for the post and for the vote of confidence. So much to be done in the world, passion and serious focus are the keys to change. Best, D