Has the rise in corporate earnings justified the rich level of stock prices?

Actually, no. In fact, the stock market’s recent ascent to new record levels has made the market even more overpriced in relationship to how corporate profits are doing.

Corporate profits, of course, are up because the Trump administration pushed through tax cuts that have improved the economy and worsened the federal deficit.

According to Thomson Reuters senior analyst David Aurelio, the 500 stocks in the Standard & Poor’s 500 index now have a price-to-earnings ratio of 17.1. That means that per-share prices are 17.1 percent higher than per-share earnings.

The average price of the 500 stocks has gone up 6.6 percent since July 1, while projected corporate earnings through the fourth quarter of 2018 have risen just 0.5 percent.

Historically, price-to-earnings ratios average is 14.8. So the stock market is still overpriced.

So, I’ll say it again — even if I get grief from the Wall Street crowd: The stock market is very high. And there probably won’t be another tax cut to make earnings look better and improve price-to-earnings ratios.