Once upon a time I did this thing about the apparent relationship between S&P500 P/E Ratios and 10-year Treasuries and ...

>You mean the relationship between E/P and 10-year treasuries, right? Well, yes. Anyway, that tutorial ended with data up to year 2000. I found data to year 2005, so this brings that stuff up to date ... sort of The relationship between the E/P Ratios from Jan, 1970 to Jan, 2005 ... and the January 10-year bond yield, it looks like so The "best fit" straight line is:   E/P = 0.9844 (T-bond) - 0.0048 >So you'd expect P/E to be the reciprocal, eh? Yes, we might expect a "fair" P/E value is 1 / [0.9844 (T-bond) - 0.0048]

>So does that calculated "fair value" agree with the actual P/E Ratio? The formula "fair values" and the "actual values" are shown here   Using :       1/{0.9844 (T-bond) - 0.0048} based upon Jan,1970-Jan, 2005 S&P500 data: 10-year Treasury Rate =% "Fair Value" P/E = Get Bond Yields here.

>And that's it?
That's it.