WTF?

It continues to be quietly reported that the S&P is selling for 140 times earnings.

(And coincidentally, that 13% of the mortgages in the USA are at least one month overdue...)

(And, by the way, the FDIC just took over a three billion dollar hit today, closing three banks.)

(That makes 81 for the year, with at least another 150 or so to go.)

Where were we??? Oh yeah--the S & P...

Well, okay, this chart says it's only selling for 129 times earnings....that makes it all ok, right?

Silly ole' me was raised with the idea that 12 times earnings was the benchmark, and 10 was preferable. I mean, if one was to sell a business in its entirety, what sort of premium would a prudent person pay?

So, the question here isn't about money--lots of people profoundly qualified to enlighten us all about money.

The question is cultural: What happened to our sense of prudence? Our sense of what is proportional and appropriate? How much is enough? How much is too much, for our own good?

I just read a letter from a buddy on academic sabbatical overseas. He took his bride out for a splurge dinner at a famous restaurant. They had saved up for the evening's indulgence, and it was everything and more than they could have ever expected, a magical evening. I was so happy for them.

At one point though, he wondered out loud 'about the propriety of it, in a world of such turmoil and poverty...' In other words, had they gone overboard?

This sort of thing is why I've admired him so for thirty years--he lives his life always working to strike the balance between living generously and responsibly, and making certain he takes the love of his life to a fabulous restaurant for her birthday.

People like him don't buy $800,000 houses on a teacher's salary, or toss their money onto a 129x earnings bonfire..

...or encourage others to do that sort of stuff, so he can make the kind of money that affords him the ability to eat at that sort of restaurant weekly.

How do we create more like him?