Please find an interesting article (http://www.thedailybeast.com/articles/2011/08/15/irving-kahn-105-perhaps-world-s-oldest-investment-banker-says-economy-in-downturn-just-a-blip.html) about a real veteran of Value Investing, Irving Khan, who is 105 years old now and still working everyday. Irving had been through with the 1930’s Great Depression and had served as a teaching assistant to the legendary Father of Value Investing, Ben Graham, at Columbia University, also during the 1930’s.
Again, from a historical perspective, the market is not overvalued, but it is true we will have 5-8 years of slow US GDP growth in the 1-2% range, due to the deleveraging effect from the previous two bubbles (Per Prof. Garry Schilling: $600B annual consumer debt payoff which is roughly a 2% drag on annual GDP). So companies with solid business fundamentals traded at attractive PE ratios will prevail in the longer term. Again, in the short term, stock market follows the sentiment, and in the long term it follows the EPS growth.
Investors who are overwhelmed and controlled by the short term market sentiment will lose out to those smart ones who focus on the long term fundamentals. The choice is all yours!