> ## Content Index
> Fetch the complete content index at: https://www.yardeniquicktakes.com/llms.txt
> Use this file to discover other available public pages before exploring further.

# Corrections Now & Then
- URL: https://www.yardeniquicktakes.com/corrections-now-then/
- Published: 2022-05-12T03:11:00.000Z
- Updated: 2022-05-12T23:39:54.000Z
- Description: The S&P 500 is down 18.0% since it peaked at a record high on January 3. The current selloff is reminiscent of the 19.8% correction during the last three months of 2018 through Christmas Eve.
- Author: Ed Yardeni
- Tags: Stock Market, Technicals

If it turns into a bear market, it will be more reminiscent of the short-lived 1987 bear market, when earnings continued to grow because a recession didn’t occur, as was feared at the time. If a recession does occur because the Fed and/or the Bond Vigilantes cause it to bring inflation down, the bear market could be similar to the ones in the early 1980s. We are still forecasting a 30% chance of a 2022 recession at this time.

Here are a few more stats on this selloff:

**(1)** The S&P 500 stock price index is 12.3% below its 200-day moving average. That’s comparable to what happened during the previous corrections since 2009, and suggests that the market is oversold if recession fears abate.

**(2)** Back on Christmas Eve, December 24, 2018, the forward P/E of the S&P 500 bottomed at 13.5\. Currently, the market is still looking for a bottom. The S&P 500’s forward P/E is down to 16.7 from 17.5 on Friday. We are still looking for a bounce, if not a bottom at 16.0\. Again, that’s assuming as we do that a recession isn’t in the cards.

**(3)** The S&P 500 Growth’s MegaCap-8’s total market cap is down 36% from $12.3 trillion on December 27, 2021 to $8.6 trillion now. That’s the lowest since March 26, 2020.

**(4)** That puts the MegaCap-8’s forward P/E at 23.6, down from 25.4 on Friday and the lowest since 23.6 the week of April 3, 2020\. At a forward P/E of 16.0, lots of stocks would be even cheaper.

![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2022/05/5.112.22-QT-1-1.jpg)

![](https://storage.ghost.io/c/16/ef/16efc0dd-240f-4f5e-9e01-d619d6fd4fd1/content/images/2022/05/5.112.22-QT-2-1.jpg)