Investor focus has shifted from earnings to valuation. We are
now most often asked at what P/E should the market trade.
We offer four approaches: (1) history of multiple expansions
from bear market lows suggests 14.1x; (2) our top-down P/E
model suggests 13.7x; (3) our DDM-derived 2009 price-target
of 1060 implies 13.1x; and (4) the Fed Model implies 16.4x.