P/E rations:
in 2010 around 15
by 2025 around 8.3-8.4
by 2030 around 9 – 9.14
Stocks down until 2011 declining 13% relative to 2010
recovery is slow, real stock prices are not expected to return to 2010 levels until 2027
the M/O (middle age cohort) ratios rebound in 2025
we should expect a strong recovery by 2030, real value of equities will be 20% higher than in 2010.
Figure 1: P/E ratio and M/O ratio
Figure 2: Projected P/E ratio from demographic trends
References:
Zheng Liu and Mark M. Spiegel. Boomer Retirement: Headwinds for U.S. Equity Markets?
http://www.frbsf.org/publications/economics/letter/2011/el2011-26.html
03/18/08 DZZ: 22.65-24.40 <- close, gold: 1006.75
09/11/08 DZZ: 39.93 <- close, gold: 740.75, DZZ up ~52% gold down 26%
09/22/08 DZZ: 26.94 <- close
09/08/09 DZZ: 18.02-18.56 <- close, gold: 1000.75
Somehow I do not see this as being a major profit driver for the following reasons:
1) Prices of HDTV are falling faster than apples in the fall
2) Everyone I know already has a HDTV – ask all of your friends
3) Consumers are retrenching as evidenced by the rising saving rate and will put off big purchases
4) Chances are deflation is coming…
There is only 1 reason I think Apple may be successful with TV
1) If they make a TV that is ready to use out of the box with various internet TV providers (Apple TV, Netflix, YouTube, Hulu, etc)
Some people do not want to hook up many external things to their TV and instead may want to have a simple product (the question remains If they are willing to pay for it)
