Nasdaq Valuations look somewhat sane again, but...
A casual glance at the index’s multiples in November 2021 would have indicated a remarkable 30 times price-to-forward-earnings multiple, a historical aberration outside of the dot-com bubble of the early 2000s.
By the middle of last year, the usual chorus of bubble doomsayers were out in full force with their usual cataclysmic projections.
GMO co-founder Jeremy Grantham and economist Nouriel “Dr. Doom” Roubini
The Wall Street sell side. Of 2,927 individual analyst recommendations on Nov. 19, the day of the Nasdaq 100 peak,
1,897 were to buy stocks, 916 were to hold and just 114 were to sell.
If the establishment brokerages in New York had heard Grantham and Roubini, they were happy to brush them off as perma-bears and wet blankets.
it’s possible that the bizarre conditions of 2020 and 2021 inflated not just the “P” in the Nasdaq’s P/E multiple but also the “E,” the earnings.
Jonathan Levin Bloomberg 21 november 202
We can indeed, as Grantham told the FT, observe classic symptoms of mania:
the rise of amateur traders, frenzied interest in once obscure companies, soaring prices of speculative assets such as bitcoin and hot businesses like Tesla, and the emergence of special purpose acquisition companies, or Spacs.
Martin Wolf 16 March 2021
https://englundmacro.blogspot.com/2021/03/if-correction-is-due-to-higher-rates.html
The Stagflation Threat Is Real
Nouriel Roubini Project Syndicate Aug 30, 2021
https://englundmacro.blogspot.com/2021/09/the-stagflation-threat-is-real-roubini.html
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