Using the historical trendline, 2001 was when we made the transition from being in the red (undervalued) relative to the trendline to being in the black. I reckon we passed the point of the first standard deviation in late 2002 or maybe early 2003. Up until that point everything was still in the normal ebb and flow of the long term trends and could be considered reasonable. It was what happened later that got out of hand.
I think if you’re going to use any baseline you should go back to the trendline itself because so far the prices have always returned. That puts it back to the present value of the 2001 prices.
