*                         7/20     7/27     8/3      8/10/26
S&P 500 Index             7457.69  7411.98  7489.72  7757.64
Trailing 12 month PE      32.41    28.49    28.63    29.69
Trail Earnings yield      3.09%    3.51%    3.49%    3.37%
Forward 12 month PE       20.88    19.77    20.92    20.53
Fwd Earnings Yield        4.79%    5.06%    4.78%    4.87%
90 day tbill yield        3.85     3.96     3.83     3.87
10 year tbond yield       4.55%    4.69%    4.75%    4.65%
Arezi Ratio               1.25     1.13     1.10     1.15
Fed Ratio                 0.95     0.93     0.99     0.95

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 63%
stocks, 37% cash this week.

Other timing indicators:
The S&P index is above its 200DMA. - Bullish
We are in the May-Oct part of the year. - Bearish
The trailing PE ratio of the S&P is above 17. - Bearish
The treasury yield curve is normal. - Bullish

A composite allocation may start with the Arezi formula and subtract 10%
for each bearish indicator. The current target allocation is 43%.

An alternative allocation, using S=120-30*Arezi Ratio and the first
two of the other timing indicators, produces a target of 76%.

Elan