His numbers are correct if you take inflation into acct. a 112 per share value on the sp 500 is 84 in 2000 dollars, making this "record braking sp run" flawed. We are 18.5 pe is you use 2000 dollars to justify a 1550 sp price target.
I agree the weaker the 10 yr the stronger the argument is for an explosive stock market run, but at sub 2% you would expect the sp to be up huge.
Using your 1550 and 14.5 you have a earnings yield of 6.9%. In order to make it fairly valued to 10yr treasury investments at 2% the sp would be heading to 5600 if earnings are to be fairly compared using 112 as your per share value.
Anyone see that coming? I would not expect that level in my lifetime under normal conditions. Inflation will stop the market well before the treasury equated value to sp earnings ever happens if we are talking sub 2% rates. If rates go back to 5.5% like your example, it would slow sp earnings power as well and limit a normalized sp trajectory assuming 15 pe is average.
your numbers are erroneous non-sense. I will help by telling you that estimates are for $108-$112 per share S&P 500 2013. The index is at 1550. P/E 14.5 TIMES.
Second, historically the S&P 500 has averaged 15.9x that p/e typically moves above or below that number depending on where the 10 year US Treasury is trading. That 15.9x S&P 500 correlates with a 5.50% 10 year Treasury.
The P/E Ratio of the S&P 500 has expanded when the 10 year drops below 5.50% and typically contracts above 5.50%.....so with the 10 year Treasury at 2.05% its not hard to see where the p/e multiple on the S&P 500 can expand.