What that chart means that if you buy now you don’t get a lot of income, relative to historical returns, for what you pay. I would label that the opposite of a “healthy profit margin.”
The only tangible aspect of the “business friendly political atmosphere” is some reduction of tax expenses for a limited timeframe. Returns on equities cannot be sustained long-term by a tax break.
As for the OP question, you only asked half a question. Investment decisions need to be made in the context of a holding period.[/quote]
No, I meant real profit margin (https://www.yardeni.com/pub/sp500margin.pdf). It has nothing to do with the tax cut but everything to do with the fact that governments now allow monopoly to exist in almost everywhere.
When a company has monopoly, it is much easier to maintain profit margin (Cox just raised price on almost all tiers in the new year, despite the tax cut). Well, what are you going to do about it?
