As my southern grandmother would have said, "What in tarnation?!"
Below is a list of my favorite charts demonstrating the US stock market is bubbly, bubbly, bubbly...
You may not agree, but it should give you pause...and at least reflect!
Any I missed?
This will be a big airdrop of charts so strap in!
First up, valuations...everyone loves to dunk on me for CAPE ratio valuations, but as you will see these are the least extreme indicator...
US stocks expensive (rest of world, cheap!)
mebfaber.com/2020/01/10/the…
HT: @GlobalFinData
People love to justify high valuations due to interest rates, but at least historically, dark times ahead...
mebfaber.com/2021/01/06/sto…
Median stock worse than 00
HT: @LeutholdGroup
Size and valuation level all time highs
HT: @hussmanjp
At least on a relative basis mid and small cap less expensive...
HT: @LeutholdGroup
Sentiment is euphoric...US investors expect > 15% returns
HT: @SchrodersUS
And average sentiment on II (since 1950s) has been high for last few years...which is usually awful time to invest
HT: @LeutholdGroup
Everyone expects stonks to be #1
HT: @barronsonline
which, given the flows, is a bit like this
People are increasingly getting pushed out the risk curve, or said more technically, doing really stupid shit.
HT: @business
maybe this time will be different but historically SPACs have been a $ incinerator...
smaller traders are YOLOing into options
HT: @Greenbackd
and despite GME situation, most stocks have very low short interest (largely due to short sellers going extinct)...
HT: @business
@Jesse_Livermore old favorite indicator, stocks as a % of household assets near or at all time high...
HT: @NDR_Research
why not add some leverage? romp up in margin debt...
everyone attracted to the expensive stocks too...
I'll add to this thread in the coming days, weeks, and months as things get sillier. In the meantime, you may like my old paper on tail risk and hedging the bad times, if they ever come again!
PDF
cambriainvestments.com/wp-content/upl…
I love valuation charts where the turning points are obvious and get the big ones correct (early 80s cheap, late 90s bubble, GFC cheap, and now ¯\_(ツ)_/¯)
via @LeutholdGroup with Price to peak cash flow, Green Book my single favorite monthly read!
Another one
cannabis stocks are up, checks phone twice, over 50% in the past week.
no money mo problems via @LeutholdGroup
via @LeutholdGroup
Share this Scrolly Tale with your friends.
A Scrolly Tale is a new way to read Twitter threads with a more visually immersive experience.
Discover more beautiful Scrolly Tales like this.