*                         8/3      8/10     8/17     8/24/26
S&P 500 Index             7489.72  7757.64  7785.76  7674.37
Trailing 12 month PE      28.63    29.69    30.06    29.46
Trail Earnings yield      3.49%    3.37%    3.33%    3.39%
Forward 12 month PE       20.92    20.53    20.60    20.28
Fwd Earnings Yield        4.78%    4.87%    4.85%    4.93%
90 day tbill yield        3.83     3.87     3.86     3.88
10 year tbond yield       4.75%    4.65%    4.68%    4.74%
Arezi Ratio               1.10     1.15     1.16     1.14
Fed Ratio                 0.99     0.95     0.96     0.96

The Arezi Ratio is the 90 day tbill yield divided by the trailing
earnings yield of the S&P500. A low ratio means that stocks are undervalued.

The 'Fed Ratio' is the 10 year treasury bond yield divided by the
forward estimated operating earnings yield of the S&P500. A low ratio
means that stocks are undervalued. Thus, a ratio of 0.71 for example
means, according to Yardeni, that stocks are cheaper than 'fair value'
by 29%.

The 'S=120-50*Arezi Ratio' formula indicates an allocation of 63%
stocks, 37% cash this week.

Other timing indicators:
The S&P index is above its 200DMA. - Bullish
We are in the May-Oct part of the year. - Bearish
The trailing PE ratio of the S&P is above 17. - Bearish
The treasury yield curve is normal. - Bullish

A composite allocation may start with the Arezi formula and subtract 10%
for each bearish indicator. The current target allocation is 43%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 76%.

Elan