*                         8/12     8/19     8/26     9/2/24
S&P 500 Index             5344.16  5554.25  5634.61  5648.40
Trailing 12 month PE      26.13    27.38    27.75    27.74
Trail Earnings yield      3.83%    3.65%    3.60%    3.60%
Forward 12 month PE       22.60    23.42    23.78    23.76
Fwd Earnings Yield        4.42%    4.27%    4.21%    4.21%
90 day tbill yield        5.33     5.33     5.25     5.21
10 year tbond yield       3.94%    3.89%    3.81%    3.91%
Arezi Ratio               1.39     1.46     1.46     1.45
Fed Ratio                 0.89     0.91     0.91     0.93

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 48%
stocks, 52% 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 inverted. - Bearish

A composite allocation may start with the Arezi formula and subtract 10%
for each bearish indicator. The current target allocation is 18%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 67%.

Elan

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