Yesterday, President Obama shows his talent at stock analysis. He said:
“What you’re now seeing is profit-and-earning ratios are starting to get to the point where buying stocks is a potentially good deal if you’ve got a long-term perspective on it,” Obama said Tuesday.
Would someone please tell me what “profit-and-earning ratios” are ? I’m not an expert, like Obama, and I don’t give advice but what I have read about are “price-earnings ratios.” That means, if the stock costs $50 and yields a dividend of $5 per year, the P/E is 10, usually a good place to buy if the stock is otherwise of value and has good prospects.
I’ve never heard of “profit-and-earnings ratios.” How would you calculate that with most companies showing poor profits or losses. How do you calculate a “profit-and-earnings ratio” for a stock of a company that shows a loss this year?
What this suggests to me is that Obama knows nothing about the stock market, except how to make it fall 20% since the election. I’m not the only who worries.
In fact, the market is collapsing precisely because Obama is doing almost everything wrong when it comes to putting in place a sound long-term strategy — from shaking the confidence of the market and the public, to targeting businesses and the investor class in America, to promising tax increases in a nasty recession, to increasing spending by trillions of dollars, to being clueless about how to deal with the banking crisis and toxic assets. The performance of the market is evidence it has almost no confidence that President Obama and his Administration know what to do to help the American economy regain its footing. And why should it?
Tags: Obama, stock market
That one’s going down, too.
See, Dr. K., profits are evil, and Obama now has profits driven so low that there may be some good deals out there.
Not yet, doombuggy. Not yet.