Doug Kass appeared on Fast Money on 10/28/09 and discussed how he calculated the bottom this last March.
- Looked over 7 decades of S&P data. Market is valued at about 15x usually, 11.5x at the bottom.
- Book value of the S&P = $560 at the time. The average industrial earns 12%, or $67.
- $67 x 11.5 = 770, or about 800 on the S&P
- On March 9, 2009, S&P was at 685, way below. 685 is 9.7x (actually, 10.2x if you do the math)
- PE was also very low, especially in a time of quantitative easing.
And thus he called bottom in March.
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