Even though it was a rhetorical question, here are the answers since I looked:

1998-1999: 23x-30x range, then P/E ratio FELL when stocks sold off

2002: 17x-20x range, and stayed close to there (moving down to 15x in following years)

2006-2008: 15x-18x range, then P/E ratio ROSE slightly when stocks sold off

“Its pretty clear that markets can and do move independent of earnings.”

Agreed. But it makes no sense to me to imply that it was a panicky reaction to look at falling earnings as a reason to sell stocks rather than live with the alternative of a skyrocketing P/E, especially in the context of an unprecedented earnings bubble around 2006-2007, which left little justification for earnings to “bounce back” rapidly once the panic cleared.

There were definitely many panicked sellers, but I think for every seller there was a non-panicked buyer willing to pay what they considered a fair multiple of earnings.

In a rational world you would be right.

However Reason deserted the quants and, with the imagination of Ponzi, and his disciples at the 5 IBs, the “Master’s of the Universe “, inventing 100x derivatives that idiots gambled on with trillions of dollars of zirp loans.