> A very interesting article is available online from Atlantic Monthly
> at http://www.theAtlantic.com/atlantic/issues/current/9909dow.htm.
> (The article is in three parts, and the 2nd and 3rd parts are the more
> informative sections.)
> The authors analyze stock market prices using basic techniques of
> expected income stream and also risk premiums, and conclude that
> stocks are actually extremely UNDERvalued today (and always have been).
> By their model the Dow ought to be running at 36,000 or even more.
I read part of that article. They were saying that "the value of a stock is the money it will bring you." It seemed to me that they were saying the proper value /today/ for a stock would be the sum of all the money it would bring you in the future. This is pretending that the economy is static and there is no such thing as growth. It doesn't even make sense, because then the value of any investment is infinite if you look far enough into the future. I stopped reading at that point.