The purpose of the study reported here was to determine the earnings multiple of the U.S. stock market (proxied by the S&P 500 Index) that can be justified by economic fundamentals at any given time. When price to earnings or earnings to price was used as the dependent variable, several regression models were found to be significant. The final E/P model had eight significant variables and explained more than 88 percent of P/E variation. This model indicates that today's multiples of 30 to 35 are not justified by current or expected economic conditions.