Warren Buffett says buy. Jeremy Grantham says it will get worse. Both are celebrated value investors. Who is right? It all depends upon your view of the third derivative of investing. Today we look at valuations in the stock market. This is the second part of a speech I have given in the past few weeks in California and Stockholm. I am updating the numbers, as the target keeps moving.

Mortgage insurers are hardly popular among investors at the moment. But Andrew Snyder says MGIC Investment Corp. (NYSE:MTG) is likely to survive the real estate meltdown. And as shares are already down 95% from their peak in March 2007, further downside potential is limited.

This is it. The Narnia of trend lines is chronicled to its happy end right here. We are in the final installment today. We’ve covered three of the four major trend lines.