Crash 'Risk' Is Soaring: "This Is Where They Lost Their Minds"

Last week, the U.S. equity market climbed to the steepest valuation level in history, based on the valuation measures most highly correlated with actual subsequent S&P 500 10-12 year total returns, across a century of market cycles.

As Didier Sornette correctly observed in Why Markets Crash,

“The collapse is fundamentally due to the unstable position; the instantaneous cause of the crash is secondary.”

My sense is that investors are going to learn this again the hard way.

More