Quote: (04-08-2014 07:56 PM)Feisbook Control Wrote:
Based upon the excerpt you provided, I didn't read the entire article (because it seemed like nonsense).
All of that mentioning "value" without once mentioning fundamentals.
I would recommend you read the entire article, and his follow up article :
http://philosophicaleconomics.wordpress....e-fitting/
"In this piece, I’m going to do four things.
First, I’m going to challenge the entire business of making “valuation vs. future return” charts. These charts are tenuous, unreliable ways of estimating future returns and of attempting to resolve debates about market valuation.
Second, I’m going to explain the conceptual basis for valuation metrics in general, to include a detailed description of the principles on which they operate. These principle are not trivial.
Third, I’m going to discuss the problem with valuation metrics–why it’s so hard to use them to accurately estimate future returns.
Finally, I’m going to delve into the debate on profit margins, which is what the debate on valuations ultimately comes down to."