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2021-12-03

“Crazier than the dot-com boom.“

 “Some of the valuations we saw in the dot-com boom were higher,” he said, according to The Australian Business Review. “But overall, I consider this as being even crazier than the dot-com boom, which blew up in 2000.”

Specifically, Munger said many U.S. companies were trading 35 times earnings, making it tough for average investors to get a foothold, with valuations the most extreme he’d seen in recent history.

Vice Chairman of Berkshire Hathaway, Charlie Munger

MarketWatch 3 december 2021

https://www.marketwatch.com/story/berkshire-hathaways-charlie-munger-says-markets-crazier-now-than-they-were-in-the-late-1990s-11638525537?mod=home-page

Even the most generous of valuation gauges shows the U.S. stock market is overvalued
The price-to-book ratio is higher, and therefore more bearish, than at almost any other time in recent decades
Unfortunately, including intangibles doesn’t reduce the price-to-book ratio enough to give the bulls much to hang their hat on

Current status of valuation indicators

Mark Hulbert MarketWatch Dec. 3, 2021


LaVorgna said the bond market isn’t yet prepared. 
And to MarketWatch, he said neither is the stock market. 

The end result for equities? 
“Eventually a serious compression in multiples,” he said in an email. The last reading for the Shiller price-to-equty ratio was a staggering 39.


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