I wish it would hit 1000 because it would be nice to buy things on sale but I just don't think even 1850 will be touched again. However, I'm all in cash as of today's close. I just cannot see overpaying this much for stocks and can't find a single thing I'd want to own at these prices.
That sounds right. Maybe sooner. 125 by Christmas, about 350 in 12 months and around $1.2 billion in 11 years.
Jeremy Grantham who has an incredible long term track record says we go to 2350, then 1150 on S&P. That would take UVXY from 24 to 1 to 5.
He's going to get whomped today.
Just... wow. We're going to print 2000 very soon so he's now staking his entire reputation and career on a 50% decline in the market. Wow.
I think small caps and techs are in a bubble. The Russell p/e is almost unbelievable, so to me that shows pretty extensive speculation. However, I part ways with Hussman in him thinking valuations are enough to cause a big market drop. I think we need a recession, a huge interest rate spike or some other catalyst. Who's to say the market can't go sideways for a long time? Certainly it's possible and then if the market is around today's levels in 5 years HSGFX would be 7 or less.
The thing is how much longer can we go on "good for stocks because more stimulus is coming" until people actually want the economy to get better? It hasn't done a darn thing in years now. Tepid growth at best.
I hear you- that's a very fair argument. The usual metrics don't seem to be working because this isn't exactly the "usual" market.
The only concern I have is Tobin's Q which is the most reliable indicator of future returns shows a fair value of 1100 on S&P. I am beginning to think it's no longer a valid metric because of low interest rates. If interest rates spike it would change everything.
I do feel bad for him because this is indeed an equity bubble but his performance speaks for itself. I feel worse for his shareholders.
You kidding? A green close on S&P on a terrible news day is good for bears?
No not 12 PERcent silly, 12 cents.
And I don't care if you're 1 day old and going to live to be 200.
It doesn't matter what Hussman says, this market will never have a meaningful correction just because of valuations. You need something like an interest rate spike coming out of nowhere or a recession. Just saying "Shiller p/e and Tobin's Q and Market cap to GDP ratio all indicate 100% overvaluation" isn't going to cut it. What if we go sideways for a few years? This fund will be down to 7.50.
It really is a new era. The usual stuff that he touts on his website, like Shiller p/e and Tobin's Q, don't work in this 0 rate environment. yes Labor Day would be a happy time with a 2000 print. What do they do on Thanksgiving then? Nasdaq 5000!!!
I've been very long with a trailing stop for the last few years, always nervous because the Shiller p/e and Tobin's Q and all the other usual valuation techniques we're screaming overvalued.
Finally it's occurred to me- those no longer work. With perpetually low interest rates and a Fed that will always backstop the market, you really don't need to worry about a correction anymore.
There will never be a spike again! This is a wonderful bubble. It's just a shame the economy has never recovered. If inflation were stated accurately (5-7%) we'd still be in recession. Oh well, can't have it all!