*                         2/23     3/2      3/9      3/16/26
S&P 500 Index             6909.51  6878.88  6740.02  6632.19
Trailing 12 month PE      27.30    27.07    26.44    25.93   
Trail Earnings yield      3.66%    3.69%    3.78%    3.86%
Forward 12 month PE       23.14    22.97    22.46    22.04
Fwd Earnings Yield        4.32%    4.35%    4.45%    4.54%
90 day tbill yield        3.69     3.67     3.69     3.72
10 year tbond yield       4.08%    3.97%    4.15%    4.28%
Arezi Ratio               1.01     0.99     0.98     0.96
Fed Ratio                 0.94     0.91     0.93     0.94

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 72%
stocks, 29% cash this week.

Other timing indicators:
The S&P index is above its 200DMA. - Bullish
We are in the Nov-Apr part of the year. - Bullish
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 62%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 91%.

Elan

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