Comment by 0xDEAFBEAD

The P/E ratio references "price" and "earnings". Both "price" and "earnings" are denominated using money. So it's not obvious to me how an increase in the money supply should affect this ratio.

BTW, in Shiller's book which was published right as the dot-com bubble popped, he has a chapter listing out similar late 90s structural factors, many of which could lead to permanently higher stock prices in theory.