11# Signal 2 Noise

In today’s issue:

1. S2N Updates.

2. Key Performance Wrap

3. Valuation – Shiller PE 

S2N Updates

I am writing today simply because I want to maintain the consistency of writing a letter. However, my main focus is getting the rest of the site up to speed so I can actually focus on these newsletters. 

Performance Review

Chart Gallery

I wanted to share a chart of Natural Gas. As you can see it is clear to making new all time lows. I ask the question is Crude Oil about to follow.

Active Signals

Economic News Today

S2N Insights

Valuation of the SP500 using the Shiller PE 

I have written an in-depth Insight post to explain the details of how to understand the Shiller PE valuation metric.

The current Shiller PE ratio is most certainly overvalued. I need to improve this chart. The dotted horizontal line is the mean PE, which is around 17. The current PE is over 30; so we are certainly in rare overvaluation territory. 

We know with pretty strong certainty that with a PE of 30, we should be expecting a 10-year return of around 0%.

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