Are Stocks Overvalued?

By Keith Weiner – Re-Blogged From Silver Phoenix

We could also have entitled this essay How to Measure Your Own Capital Destruction. But this headline would not have set expectations correctly. As always, when looking at the phenomenon of a credit-fueled boom, the destruction does not occur when prices crash. It occurs while they’re rising. But people don’t realize it, then, because rising prices are a lot of fun. They don’t realize their losses until the crash. So we want to look at stocks when they’re high, before people realize what’s happened to them.

How do you value a stock? The classic methodology, proposed by Benjamin Graham and Warren Buffet, is to discount future free cash flows. Let’s leave aside the problem of how to predict future revenues much less cash flows in our crazy resonant system with positive feedback. For purposes of this discussion, we will just assume that a stock generates a known and constant cash flow of, say, $1 per year, in perpetuity.

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AAAS: “Let’s hold them accountable”

By David Middleton – Re-Blogged From http://www.WattsUpWithThat.com

This morning, I received another email from the American Association for the Advancement of Science…

AAAS junk

We cannot overstate this: Under the current administration, the future of scientific inquiry and discovery in the U.S. is in serious jeopardy.

You can do something important right now to protect our progress and our planet: become an AAAS member.

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Discounting Away the Social Cost of Carbon: The Fast Lane to Undoing Obama’s Climate Regulations

By David Middleton – Re-Blogged From http://www.WattsUpWithThat.com

Trump to Drop Climate Change From Environmental Reviews, Source Says
March 14, 2017, 1:06 PM CDT
  • Directive to reverse Obama-era mandate for agency actions
  • Clean Power Plan, methane rules and coal halt also addressed

President Donald Trump is set to sign a sweeping directive to dramatically shrink the role climate change plays in decisions across the government, ranging from appliance standards to pipeline approvals, according to a person familiar with the administration’s plan.

The order, which could be signed this week, goes far beyond a targeted assault on Obama-era measures blocking coal leasing and throttling greenhouse gas emissions from power plants that has been discussed for weeks. Some of the changes could happen immediately; others could take years to implement.

It aims to reverse President Barack Obama’s broad approach for addressing climate change. One Obama-era policy instructed government agencies to factor climate change into formal environmental reviews, such as that for the Keystone XL pipeline. Trump’s order also will compel a reconsideration of the government’s use of a metricknown as the “social cost of carbon” that reflects the potential economic damage from climate change. It was used by the Obama administration to justify a suite of regulations.

Trump’s Secret Weapon Against Obama’s Climate Plans

Tom Pyle, president of the American Energy Alliance, a conservative, fossil fuel-oriented advocacy group, welcomed Trump’s comprehensive approach, calling it essential to undoing Obama-era climate policies that “permeated the entire administration.”

[…]

Bloomberg

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