Global Performance Column: Purchase courses?

In recent months we have in the global performance (in contrast to many other stock exchange publications) warned that valuations for equities are still too high. We based this not on the shaky profit prospects of enterprises, but on the stages of crisis far more meaningful value. In the last bear market low (early 2003) was the price-book value ratio (KBV) in the DAX temporarily one. Given the current economic crisis is far deeper, this value should be – so our argument – at least once again be achieved. With the recent price slide has come: The average NASHIP among German blue chips has fallen to about one. Is the time ripe for stock purchases?
On the exchange list can be found now in any case some of the titles, the character bargains. Especially in the low-field values are the reviews of some papers barely understand (such as Asian Bamboo, which concluded on Friday with excellent figures for 2008 and a solid outlook shone to 2009). Even in the DAX to see some companies favorable. Problem: The earnings of many companies is bad: The accumulated losses in the DAX is likely in the fourth quarter on a two-digit billion sum amount. And the latest economic data still tend to speak for a further deterioration.

This is the balance sheet situation of the blue chips are anything but solid: the ratio of (shaky) intangibles to equity is at least 62 per cent increase. Three years ago this ratio was only 46 percent. To this level again to reach, should be around 100 billion euro depreciated. The balance sheet carrying amounts would be reduced by this amount and the new room for price reductions create. True cheap DAX probably only in the area around 3000 meters.

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