Why wouldn't I just pour all of my money?

Uh, when I started farming,

It's just a faster way of saying

So let me switch colors just to ease the monotony.

So growth is the other reason why you're willing to pay a higher Price to Earnings ratio.

Let's say that we don't know that they're truly equal.

looks neutral.

So in 2013 you'll be making 16.

Now what does that mean?

This is 2009 estimates.

700 rads per shot. (Laughter)

Her salary is very high.

If I'm paying 10 today for 2 of earnings in 2009, the Price to Earnings of 5 for Company A.

Maybe it goes to 2 in 2010.

He's got a good track record.

And you're going to pay a lower Price to Earnings ratio if the company isn't growing.

One of the viewers pointed out not incorrectly that one definition of return on asset so this whole video's going to be on return on asset that one definition of return on asset, and if you look it up on some of the finance sites or even some finance textbooks, they'll tell you it's net income over total assets.

Was the official toll. Seriously?

So a lot of people immediately will figure out the Price to

Today, there are 2.3 million.

Her job brings in a high income.

And let's say Company B made 5 per share. 5 EPS, Earnings Per Share.

He has a high batting average.

The digital mammogram was read as normal and shows lots of dense tissue, but the MBI shows an area of intense uptake, which correlated with a two centimeter tumor.

And the earnings on the bank account in that year were 200.

Population growth will mainly occur among the poorest people here because they have high child mortality and they have many children per woman.

Price to Earnings ratio.

Divided by 0.35.

And we touched on that in the first video when we talked about bank accounts.

So just when you look at it superficially right here, when you take Price to Earnings and actually just as a little aside, whenever someone says the Price to Earnings ratio is 10, or the Price to Earnings for Company B is 4, the first thing you should ask is, what earnings are you using?

That's what we're seeing across the bottom billion at the moment.

You're in the gang for four years, you expect to die with about a 25 percent likelihood.

And these are the so called developing countries.

And B is expected to make 4 per share.

That was a bit of a diversion.

This paper has very good absorption.

But in the last four years,

What do you know?

So that's a little bit of a taste of why someone might realistically, in this case, pay a higher Price to Earnings for safety.

the risk is too high.

The price here, Company B was more.

That's still way more expensive than most companies.

You're making 10 , and that's just to connect the dots.

It was 10.

So it has a Price to Earnings of 50.