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Saturday, July 15, 2017

Bubble Update: Stocks Are Now at 1999 Bubble Levels (Guess What's Next)

Remember the 2007 Bubble?

Remember how everyone said that it really wasn’t that big of a bubble because stocks weren’t as expensive as they had been during the previous bubble (the Tech Bubble).
We all remember how that turned out: the bubble burst leading to the greatest financial crisis in 80 years.

Well, today’s bubble is WAY larger than that of 2007. And arguing that stocks are cheaper than they were during the Tech Bubble doesn’t hold water anymore either.

Below is a chart showing the S&P 500’s Price to Sales ratio (also called the P/S ratio). As you can see, based on this metric, the 2007 Bubble is a mere blip. We’re now in territory not seen since the 1999-2000 Bubble.



Anonymous said...

I'll believe this after I see the tea leaf, moon phase, planet alignment and the head of the Fed's biorhythm charts all pointing in the same direction.

Anonymous said...

I'm 64 and I have yet to hear the prophets of doom admit incorrect predictions.