August 6, 2020

Highest recorded PE

Markets became unstable at PE above 28-30 and tend to undergo a long correction.

What is the highest PE recorded?

- in 2000, the S&P500 PE reached 40... this was followed by the dot com bust
- and in 2008, the PE reached 120... this was because the EPS was forcefully brought down but the price took a longer time to correct

Here is the chart

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