A long term perspective is the best cure for anchoring.
Above is the AUD to USD chart since the Australian dollar floated in December 1983. These glory days are numbered. The historically strong Aussie may stay above a US dollar for a brief period, but long term it will revert to the mean, no doubt overshooting on the way there. Same goes for the kiwi dollar.
Note: I’m considering an employment offer from a US company, so this view is biased.

As requested by an encouraging commenter, BB, here is an update for the Australian All Ordinaries (^AORD) Long Term P/E Chart. I’ve included the long term average this time. As always click to enlarge.

Hat tip to Colin Nicholson for his wonderful data.

Here’s an update of the Australian All Ordinaries P/E ratio chart from this post a year ago. Click to enlarge.
There hasn’t been a lot of change since last year as the Australian market continue to stagnate.  If I get a chance I’ll update some of the other charts as per last years post. If I get even more time which is doubtful I’ll try and put together a cyclically adjusted P/E, CAPE, chart as per Robert Shiller’s wonderful data on the S&P 500.

If the US market appears cheap when viewed through your moment in time P/E filter, then perhaps it’s time to change your filter.

Data Diary’s look at the cyclical nature of markets.
Australian, US and worldwide equity risk premiums relative to bills and bonds plus real and nominal stock market returns.

Motley Fool’s Matt Koppenheffer hit the investing mainstream last week with his article on looking at value not price appreciation. It’s an easy yet worthwhile read, I’ve reprinted some highlights from the article below.  Matt’s main thrust was “our concern shouldn’t be over how much the market has gone up or down, but rather whether its valuation is attractive or unattractive”. Wise words, but I still can’t get the wiggles out of my head.
Perhaps this chart from dshort is a Rorschach test and not manipulated data to present a negative view. …

Is dshort manipulating the fork out of the S&P 500 bear market lows data to present his own world view rather than the true picture? I’ll let you be the judge.

“Long-term investors should note the time-worn rule that bear markets in Treasuries do not occur until two things happen — and these two things are highly correlated:
(i) the unemployment rate begins a descent from its peak, and
(ii) the Fed signals its intent to tighten monetary policy.” David Rosenberg

International investors should consider the Australian stock market as part of both their stock and currency diversification.
Let’s get cracking with all that’s bonzer, beaut, ace and corker with investing in Australia. I’ll start with the big picture, the Australian Share Market since 1900.

What does history tell us about the possible velocity of interest rates in the USA? I wondered about this after reading this scary prophecy at Matterhorn Asset Management, The Dark Years are Here.