Another look at Shiller P/E.
A version of this article was published in the January 2014 issue of Morningstar ETFInvestor. Download a complimentary copy here.
The Shiller price/earnings measure, which averages 10 years of inflation-adjusted earnings, is under attack. The pseudonymous Jesse Livermore delivers the most devastating broadside to the measure I've read yet. It's cogent and a hell of a read. (I encourage you to read the post at his blog, Philosophical Economics.)
Samuel Lee does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.