A Short History Of Falling P/Es

In the past, there have been dives in the S&P 500’s valuation multiple similar to the one so far this year:

(1) The valuation deterioration in the early 1970s was associated with the devaluation of the dollar by President Nixon and the first of the decade’s two energy price shocks. Along the way, Franklin National blew up. Inflation was a protracted problem throughout the 1970s.