*                         5/18     5/25     6/1      6/8/26
S&P 500 Index             7408.50  7473.47  7580.06  7383.74
Trailing 12 month PE      32.30    32.06    32.58    32.69
Trail Earnings yield      3.10%    3.12%    3.07%    3.06%
Forward 12 month PE       22.38    22.52    22.80    22.21
Fwd Earnings Yield        4.47%    4.44%    4.39%    4.50%
90 day tbill yield        3.69     3.68     3.69     3.78
10 year tbond yield       4.59%    4.56%    4.45%    4.55%
Arezi Ratio               1.19     1.18     1.20     1.24
Fed Ratio                 1.03     1.03     1.01     1.01



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 58%
stocks, 42% 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 38%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 73%.

Elan