I wanted to point you to a quick chart from Ethan Harris and his global research team at Bank of America Merrill Lynch. It addresses something I have referenced before — the idea that so many folks could be accurately spotting a bubble in real time with any degree of accuracy.
The argument I made is admittedly squishy, not relying on quantitative data or pricing. Several of you pointed this out, to which I pleaded guilty. So I started looking for more price-driven examples that might make the same case.
Hence, Harris’s chart above. When we look at the prior peaks, and the run that took markets there, it is pretty obvious in hindsight that prices had gotten stupid.
Which leads me to this question: What prices today are utterly stupid? What has run up with no logical explanation?
I see lots of asset classes that have had great runs, but nothing I can point out as insane. Even the 160 percent S&P 500 rally follows a 57 percent drop, and a 140 percent earnings gain from the lows. That’s somewhat above median, but not unprecedented.
Question: What specific prices are revealing of a bubble?
Please use the comments to demonstrate your own ignorance, unfamiliarity with empirical data and lack of respect for scientific knowledge. Be sure to create straw men and argue against things I have neither said nor implied. If you could repeat previously discredited memes or steer the conversation into irrelevant, off topic discussions, it would be appreciated. Lastly, kindly forgo all civility in your discourse . . . you are, after all, anonymous.