Chart of the week: the dangerously pricey S&P 500

Chart: S&P 500 p/e ratios since 1976

The S&P 500 is dangerously pricey, according to a Goldman Sachs note. The bearish tone of the report has raised eyebrows, given Goldman’s reputation for being perma-bullish. It points out that the index’s current price/earnings (p/e) ratio is 15.9, a rarity in market history.

Since 1976, the only times the p/e has been higher than 17 were during the tech bubble of the late 1990s. The ten-year and 35-year average p/es are 14.1 and 13 respectively.

• Stay up to date with MoneyWeek: Follow us on TwitterFacebook and Google+

MoneyWeek magazine

Latest issue:

Magazine cover
Why you should worry about Greece

...and how to protect your wealth

The UK's best-selling financial magazine. Take a FREE trial today.
Claim 4 FREE Issues

From ADRs to Z scores – all the terms you wish you understood, but were too embarrassed to ask about.

Gervais Williams: if you want real dividend growth, buy small-cap stocks

Merryn Somerset Webb interviews small-cap stock expert Gervais Williams about how penny shares outperform blue chips 'again and again'.


Which investment platform is the right one for you?

When it comes to buying shares and funds, there are several investment platforms and brokers to choose from, with varying fees and charges. Find out which is best for you.


3 July 1767: Pitcairn Island is discovered


Pitcairn Island was spotted on this day in 1767 by 15-year old midshipman Robert Pitcairn, serving on HMS Swallow. It was marked wrongly on the ship's chart, and was promptly lost again.


Anatomy of a Grexit: how Greece would go about leaving the euro

Jonathan Loynes and Jennifer McKeown, economists at Capital Economics, look at the key issues and challenges of a Grexit, how it might be best managed, and set out a timetable for change.