Serving as a counterweight to Nouriel Roubini on Squawk Box, investor and writer James Altucher presented his case for S&P 1500 this morning.
The gist: Stocks are just ridiculously cheap right now, at around 10x-11x earnings, and when you look at bonds priced with yields below 3%, it’s a no brainer to invest in equities.
Even if you think the economy is going to remain in the toilet, argues Altucher, they’re still a good buy. Any upside would be gravy.
Among his points: You can’t worry about corporate profits reverting (down) to the mean, while also worrying about the soft labour market. Corporate margins will only shrink if companies start hiring again, in which case you’d have improved consumer demand, and better top-line growth.
Naturally, Roubini wasn’t buying it.
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