*                         1/21     1/28     2/4      2/11/19
S&P 500 Index             2670.71  2664.76  2706.53  2707.88
Trailing 12 month PE      19.10    19.04    19.40    19.39
Trail Earnings yield      5.24%    5.25%    5.15%    5.16%
Forward 12 month PE       17.34    17.27    17.39    17.37
Fwd Earnings Yield        5.77%    5.79%    5.75%    5.76%
90 day tbill yield        2.41     2.39     2.40     2.43
10 year tbond yield       2.79%    2.76%    2.70%    2.63%
Arezi Ratio               0.46     0.45     0.47     0.47
Fed Ratio                 0.48     0.48     0.47     0.46

The Arezi Ratio is the 90 day tbill yield divided by the trailing
earnings yield of the S&P500. A low ratio means that stocks are undervalued.

The "Fed Ratio" is the 10 year treasury bond yield divided by the
forward estimated operating earnings yield of the S&P500. A low ratio
means that stocks are undervalued. Thus, a ratio of 0.71 for example
means, according to Yardeni, that stocks are cheaper than "fair value"
by 29%.

The 'S=120-50*Arezi Ratio' formula indicates an allocation of 96%
stocks, 4% cash this week.


Other timing indicators:
The S&P index is below its 200DMA. - Bearish
We are in the Nov-Apr part of the year. - Bullish
The trailing PE ratio of the S&P is above 17. - Bearish
The treasury yield curve is normal (not inverted). - Bullish

A composite allocation may start with the Arezi formula and subtract 10%
for each bearish indicator. The current target allocation is 76%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 96%.

Elan