UPDATE: Don't get spooked by 'overvalued' stocks -- they're here to stay
By Michael Brush, MarketWatch
Growth stocks have been driving stock market indices, and they can withstand higher valuations
Is the market really so fully valued that we should all get out of stocks, as the bears like to tell us?
Former Reagan administration budget chief David Stockman, for example, was recently warning that stocks will decline 40% to 70%, citing high valuations.
Relax. The bears are telling tall tales about valuation.
True, it looks like stocks are overvalued at first glance. The Dow Jones Industrial Average's forward price-to-earnings ratio is 16.7, and the S&P 500 Index's is 17.4, according to FactSet.
But in investing, like life, there's what you see on the surface, and what you understand if you drill down.
Deeper research shows why the "overvaluation" worries are misplaced. So with Halloween just around the corner and the valuation goblins coming out to haunt us, let's swat down the two main spooky valuation stories going around.