I know the market seems like its about to crash at any time. That the European financial crisis could take us down like Lehman Brothers did in 2008. How does the European debt affects us?
Well the European banks own these Greek and Italian bonds — they hold the risk. Once we get beyond the European debt, things are looking very good. The market’s very cheap and there’s a lot of large companies like Google (GOOG) and IBM (IBM) selling so low the downside is slim.
The table at the right shows the S&P’s P/E during the past ten years. Just guessing but the P/E should be 16 now. 16 times 2012’s profit estimate of $103.16 nets a S&P of 1648. My calculations show the market could rise 32% by the end of 2012
