The first day of May

Today marks the first day of correction attempt in the recent market rally. People on the street keep saying we will not see "Sell in May" effect this year considering about the unprecedented QE by Fed. However, keep in mind, the underlying assumption that P/E multiple should be the same or should expand, given current economic outcome, should not hold. Under rational analysis, most of the central banks including BOJ, EU and UK had undercut their interest rates to record low, you wondered how low can it go? The effective interest rate based on TIPS indicates a negative -1.5%, forcing investors into equity and illiquid assets, without other relative stable investment avenues. In traditional mature industries such as Telecom, we expect to see more and more M&A at an on-going basis as higher equity valuation in large cap should allow them to do M&A with equity swaps. On earning side, FB just reported $0.12 EPS. Pause here, think it over, whether P/E forward ratio about 48, with PEG 1.6, can be sustainable? People might argue FB can go expansion internationally for it to work out. I think it might be possible but depends on how it executes the plan. At least I know, expansion into Chinese market will not give it too much edge. If you were executive of Facebook, what will you do? compete with AAPL and GOOG with its Facebook mobile phone? this is a dead route as it lines just on the sustaining innovation trajectory routes on AAPL, Sansumg, Goog roadmaps. What I am thinking will be Facebook can become contents provider to company such as AMZN, or Barnes, for future growth channel. Will they go there? It is an open question.