Dow

[Hoop]

Three short weeks later, DOW 19,911 looks set for 20,000! Massive.

No worries.

I'm using S&P500 figures but the DOW correlates with the S&P500

The wow is.... analysts are predicting 2017 earnings to increase by 11.4%....est analysts consensual forward earnings $131.8 (8th Dec)
the massive is... Mr Market is already pricing this in and more...
Forward PE= Latest close 2274/131.8 = 17.25 on an increasing trend.. well above its average of 14.4...
Assumming Mr Market has also priced in the interest rate hike and the predicted rise in inflation (both negative pressures on Mr Market)

Recent history shows forward earnings predictions a year ahead have been far too optimistic ...Are predictions useful ?..see the history below

Some more history
back in 2007 before the big bear the forward PE was 1550/105 = 14.76
back in 2000 before the big bear the forward PE was ~25

No worries ..eh