Some analysts have resorted to rationalizing the stock bubble with never before seen valuation measures. To wit, if one ignores the past 12 months (trailing P/E), and disregards projections for the next 12 months (forward P/E), the 24-month forward “guestimate” for MSCI All-World companies is suggesting that current stock prices may only be modestly overvalued.
Are you buying this malarkey? Then you may wish to pick up some swamp land in Arkansas.
If investors always chose to look past recessions with unreliable forward earnings projections 24 months out, there would never be any stock declines.