If you look at the chart at the bottom comparing Dec 99 to today....

> during the internet bubble of 1998-2000, the p/e ratios were much higher

That is true, the current players are more profitable, but the weight in SPX percentages looks to be much higher today.

It seems to me that it would be a lot easier for that market concentration to revert to the historical mean without catastrophe, than for P/E ratios to revert to the historical mean without catastrophe.

(I think a reasonable argument can be made that P/E ratios today should be higher than the historical mean, or rather that they should have trended up over time, based on fundamental changes in how companies compensate their shareholders.)

▲

cal_dent 3 days ago | parent | prev [-]

i also wonder about p/e ratio comparisons over time because our world view of what long term economic growth is going forward is less now that it was then. That is always subtly implicit when we think about p/e ratio. So what's to say a 30x p/3 isnt equivalent to a 40x then

▲

Ekaros 2 days ago | parent [-]

Also it depends on where you start. Going from million to billion in price is currently pretty possible. Billion to trillion would be rare, but still could happen. Now from trillion to quadrillion. How much currency there is again...

	▲	bagacrap 2 days ago \| parent [-]
		A trillion dollar valuation doesn't imply there's actually a trillion dollars there. It's just the last price the stock sold for, times the shares in existence. If Elon tried to sell every share of Tesla tomorrow, he would get a lot less than the face value of all his shares. So in other words, there doesn't need to be that much currency, just that much hype.