(New York)

The S&P 500 is off about 6% this month, almost enough to eliminate its gain for the year. At the same time, earnings have grown strongly. Put together, a good question emerges: when do stocks again become cheap? In the last several selloffs, stocks have found support when valuations fell to 15x earnings, so it seems a good target. Taking account of various earnings forecasts, it appears stocks would need to fall a further 14% from here to make it to that level.

FINSUM: That would put the S&P 500 near a bear market just to bring the p/e ratio back down to 15x. Bleak.