What about the value of the market relative to earnings? Everybody says it's cheap. Everybody, that is, but John Hussman, of Hussman Funds, who in his weekly commentary writes that at 18-times earnings the market is into its "third phase" -- the phase, he notes, that Richard Russell of Dow Theory Letters says occurs when stocks "spurt skyward on the hopes and expectations of a continuing rosy future ... The low-priced 'cats and dogs' historically make great moves in this third phase." Adds Hussman: "To anyone who examines more than one or two decades of market history, even a multiple of 18 is very rich by historical measures, and can't be reconciled simply by reference to interest rates or inflation. On closer inspection, of course, valuations are even more hostile. Over the past three years, profit margins have widened to record levels, which have detached P/E ratios from other fundamental measures - such as price/revenue, price/dividend and price/book ratios. The S&P 500 is currently about double its historical norms on those metrics. That isn't a forecast that stocks have to eliminate that valuation gap, but it certainly does suggest that stocks are priced to deliver unsatisfactorily long-term returns from these prices."