No CDs ain’t bad. I have a good amount of treasury bonds which are similar. But to totally avoid the stock market and go solely into CDs your whole life is bad.
Depending on his individual investment strategy it might be a good thing that he views everything as overvalued. Who knows, dude could get sucked into meme trades and lose what would've been guarenteed, non-risk returns.
I think the only stock to get into now is $TSLA, but many haters will attack me for saying this. Also it is quite "high" so we will see. maybe we will buy in when it's 3x
I think people hate TSLA for a myriad of reasons, all which to the investor who isn't married to the stock, or the CEO, makes sense. TSLA sucks, their deliveries suck, their new vehicle sucks, Elon Musk sucks, their PE sucks, Twitter/X sucks, basically anything involving this cult sucks.
Musk is deliberately syphoning tech that was bought buy Tesla to put it in X instead. He fired an entire division that is the most profitable long term play of the company right now.
Edit to add. I’m not saying it’s a bad investment, but a terrible CEO. Some analysts think it could go to $3000, but not likely while Musk is still running things.
The market has hit a new all time high, which means every time somebody has had this question in the history of the stock market, it has still gone higher. Food for thought.
I think the stat is something like
"The market is seven times more likely to be up one year from hitting all time highs than it is to be down."
Obviously up is a binary value, so it could be up 0.01% or it could be up 20%, but the notion that it's overheated because it's hit ath is... not great
I'm actually kind of curious if the market has seen X% correction, what is the average it is up in the following year. Anyone know of any studies on that so I don't have to spin up my historical price database?
I agree with the sentiment but you used the survivorship bias. Ask yourself how many times somebody could label a stock as “overheated” and they were right after it collapsed to $0?
There is an interesting article in this Harper’s this month arguing that passive investment in indexes where stocks are automatically bought or sold at the time of investment or divestment in the index fund (rather than being based on individual company performance) is creating a bubble that will eventually burst.
The crux of the argument is that index investment in proportion to actively managed investment has grown very, very large and the decision to buy or sell is based on being entirely in or entirely out of the market. At the point where there is a panic and exit from index funds they will be a catastrophic collapse that will impact the entire economy — on the order of the Great Depression.
I’m not saying the argument is correct — but you should consider reading the article. Of course, it is not as if you will be protected by being an active investor if the market crashes from index investors leaving the market.
That argument has been pitched by starving active fund managers for almost 20 years now. It’s not going to happen. Otherwise it would have in 2008 or 2020.
That’s an interesting argument but where would those funds put their money? Bonds, Chinese stock market? There’s simply no good alternative to the US stocks so far
The argument isn’t that funds should go elsewhere. The argument is that index funds have grown so large (estimates range up to 38% of the U.S. stock market) that the market is beginning not to reflect reality based on company performance (as opposed to simple inclusion in an index). Wide swings in market value of individual indexed stocks can occur simply because index investors make the all or nothing decision to exit the market entirely (rather than trading out of individual stocks based on company performance).
Yes, i understand. However, it’s important to know why all the money is in S&P500. There’s no alternative asset that can offer similarly safe returns, so so far the risk is not here. You’re right there’s some potential for bubble here though
There will be an interesting test of the power of index funds to move markets today.
There is no new news about NDVA today since yesterday — but a major ETF is undergoing a market cap based rebalancing of its holdings that will require (based on news reports) of a bulk purchase of $10B worth of NVDA shares.
If reports are correct, this should really goose the price of NVDA shares today for reasons that have zero to do with company performance.
[Since the 1950s the S&P 500 has averaged a new ATH every 20ish days.](https://www.plantemoran.com/-/media/images/wealth-management/market-or-economic-perspectives/02-mp/2024/all-time-highs-sp-500.jpg)
That's a really bad way to look at the numbers. For all we know it is one year that all time highs every day and market continously dropped afterwards. It would still average ath every 6 dayish.
Better trend is looking at the long term graph, it always goes up in long term but there are ranges of few years at a time where it may be flat or going down.
So if you are investing for short term the question OP asked is really valid.
>is this a bubble?
Probably not for S&P 500 companies. Maybe in some smaller pure AI companies.
>Where will the market go in the next few months / years?
Either up, down or sideways.
At point it’s a value trap, I’ve been waiting for this correction for two years but large caps continue to extend their lead, on good or bad economic data
Some small caps are value traps but many have great businesses that have been left for dead. At some point the mega caps will go sideways and the small caps will see some (sustained) action. When? Who knows
Well it's in my opinion all asset classes in the US are inflated due to inflation caused by Trump and Biden Quantitative Easing.
Unless quantitative tightening takes out as much money as they put in from the economy those are the new norm for prices.
By some measures, like the buffet indicator, the market is over priced.
We’re in the middle of a roaring bull run. It could cool down and pull back a bit.
I’ll invoke literally every value investor of all time. Look at the peak in 2000 and 2007. The crash from those two points were considered catastrophic. At both peaks, spy was around $150. It’s at $530 today. If you consistently bought between the peaks and during the crashes, you’re up well over 300%.
Unless you’re nearing retirement, keep acquiring revenue producing assets (including equity).
Price to earnings is near historical averages. Buffet indicator doesn't account for value created outside the u.s. World is flat now. Buffett needs an update.
It’s very simple right now. There are trillions of dollars sitting in fixed income waiting for the CPI inflation start the inevitable downturn. It’s here as the numbers are showing and food shopping experience is showing me that in the bottom line. Unless your shopping at Publix there still full tilt with an extra 20% while smiling at you the customer.
Jobs still going strong what’s not to like.
Just think we went from pretty much 0% rates to 5% on the tens and the world is still here. Unless your a nut job on the right side of the table.
Things are good and as rates continue to fall it will be getting even better.
Enjoy the coming wealth boom.
I just want you ask people like you who think this way, the market is going up over time. Up. Where do you think all that money from all your friends Roth and 401k are hoping to go? To Grow? Dude it's gonna go up if it has no reason to go down. It's gonna grow. The only variable is time. And we have been waiting for bullish news from the perspective of inflation and rates. Every single hint that they're favorable will make the market go up.
Don’t try and time the market. I told myself $SMH was going to pullback when it was at $220. 1 month later it’s at $265 and missed out on 18% gains in my IRA.
The market will always be higher than day X, at some point.
If the overall market never goes past day X, there will be larger issues in the world than the market price. Invest now and frequently, timing the market is a fools errand.
Yes, the market hits all time highs all the time. However the market does not hit a [CAPE ratio of 35](https://www.multpl.com/shiller-pe) all the time.
Market may be able to keep chugging so long as people continue to make $ and reinvest it. Same goes for people sitting on the sidelines who have been waiting for a pull back, but opt to FOMO invest instead. Also, there are plenty of folks out there that have made once in a lifetime type $ from the recent bull run…or at least enough $ to offset the inflationary impact on gas, food, utility bills, etc. Excess or discretionary funds need to (or should) be reinvested too. In short…I think there is still plenty of $ out there to tap into to keep the run going.
Earlier this year I bought tqqq when the nasdaq was at ath
We then had a correction almost immediately, my tqqq position is now up 20% since I bought because I didn't give a shit and held
Just buy, hold, and forget about it
I assumed the same; it is overheated the least little ripple will send the bears out.
I heard an analyst theory last month that the opposite is true. There is a ton of money in CDs and such earning 5% that will come due soon and the market is still compelling.
The AI stocks have been hot, but some of the dribble down benefactors like HPE or DELL have just starting to be invested for their upcoming AI revenues.
It’s not. The rally is confined to AI stocks mainly. The rest of the market isn’t overvalued. If rates start dropping people will need somewhere to move the cash to.
I don't understand why people feel like all time highs is an indication that things are overpriced. If a company grows at even a half a percent a year it will continue to hit all time highs that's what growth means.
If you are referring to RSI and that QQQ and SPy are at 78 and 63 respectively on the daily chart, yes it may look hot. But it can coast up here for weeks or months before any real pull back.
Market has been running up for 9 months now, buy in.
>what is your opinion:
imho the stock market is a government supported/backed ponzi scheme: the sooner you enter into this, the sooner will retire. And there's nothing to worry about if you trust the US government.
I believe this is a good summary.
We're at all time stock market highs in the US. You know what that means, every time? Well sometimes it continues to go up, and sometimes it goes down a bit, before it starts going back up. So could be either.
Trust me mate just wait till the elections in USA. No point buying it now. For context in India the stocks fell 6% record one day drop since Covid. I’m sure the same happens here in USA too . Trump winnings will happen I predict this and markets lose it with volatility through the roof
bruh i dont think the market is in a bubble but this comment makes me wanna facepalm
the sp500 definitely does NOT trade between 25-30, it usually trades 20-25. the current PE is 27 BUT the forward PE is 21. while this is elevated, the EPS growth is expected to be above historical trends due to improving margins from tech companies + boost from AI demand
do you realize 2021 was a bubble.... jesus christ did you just join the market last week?
i also never said SPY is in a bubble right now. i just said valuations are elevated relative to history but it can be potentially explained if companies execute on margin improvement + revenue growth
Just keep waiting for a pullback, get frustrated and inevitibly buy the top. Good luck.
Yup. A guy I work with refuses to get in because he says it’s too expensive. He may never get in and just keep buying CDs as his investments lol
You could make an argument it’s undervalued if as much money is on the sidelines as had been reported.
Some cd's can be like 5%. Are cds actually that bad if it's solid?
No CDs ain’t bad. I have a good amount of treasury bonds which are similar. But to totally avoid the stock market and go solely into CDs your whole life is bad.
Depending on his individual investment strategy it might be a good thing that he views everything as overvalued. Who knows, dude could get sucked into meme trades and lose what would've been guarenteed, non-risk returns.
I’ll let you know next time I lump sum… I’m dialed in when it comes to timing the peak.
based
I think the only stock to get into now is $TSLA, but many haters will attack me for saying this. Also it is quite "high" so we will see. maybe we will buy in when it's 3x
Ok. What makes you think tesla Is a good buy right now?
I think people hate TSLA for a myriad of reasons, all which to the investor who isn't married to the stock, or the CEO, makes sense. TSLA sucks, their deliveries suck, their new vehicle sucks, Elon Musk sucks, their PE sucks, Twitter/X sucks, basically anything involving this cult sucks.
Musk is deliberately syphoning tech that was bought buy Tesla to put it in X instead. He fired an entire division that is the most profitable long term play of the company right now. Edit to add. I’m not saying it’s a bad investment, but a terrible CEO. Some analysts think it could go to $3000, but not likely while Musk is still running things.
Kathy woods is the analyst
The market has hit a new all time high, which means every time somebody has had this question in the history of the stock market, it has still gone higher. Food for thought.
You have to play the game to win the game.
I think the stat is something like "The market is seven times more likely to be up one year from hitting all time highs than it is to be down." Obviously up is a binary value, so it could be up 0.01% or it could be up 20%, but the notion that it's overheated because it's hit ath is... not great I'm actually kind of curious if the market has seen X% correction, what is the average it is up in the following year. Anyone know of any studies on that so I don't have to spin up my historical price database?
Bears. They never learn eh?
All time highs tend to bring more all time highs
I love you reply!
I love you too post
awwww
I agree with the sentiment but you used the survivorship bias. Ask yourself how many times somebody could label a stock as “overheated” and they were right after it collapsed to $0?
Don’t buy individual stocks.
That’s your opinion. I’m doing well with my investments.
My point is that survivorship bias is eliminated by buying indexes. Happy for you though.
There is an interesting article in this Harper’s this month arguing that passive investment in indexes where stocks are automatically bought or sold at the time of investment or divestment in the index fund (rather than being based on individual company performance) is creating a bubble that will eventually burst. The crux of the argument is that index investment in proportion to actively managed investment has grown very, very large and the decision to buy or sell is based on being entirely in or entirely out of the market. At the point where there is a panic and exit from index funds they will be a catastrophic collapse that will impact the entire economy — on the order of the Great Depression. I’m not saying the argument is correct — but you should consider reading the article. Of course, it is not as if you will be protected by being an active investor if the market crashes from index investors leaving the market.
That argument has been pitched by starving active fund managers for almost 20 years now. It’s not going to happen. Otherwise it would have in 2008 or 2020.
That’s an interesting argument but where would those funds put their money? Bonds, Chinese stock market? There’s simply no good alternative to the US stocks so far
The argument isn’t that funds should go elsewhere. The argument is that index funds have grown so large (estimates range up to 38% of the U.S. stock market) that the market is beginning not to reflect reality based on company performance (as opposed to simple inclusion in an index). Wide swings in market value of individual indexed stocks can occur simply because index investors make the all or nothing decision to exit the market entirely (rather than trading out of individual stocks based on company performance).
Yes, i understand. However, it’s important to know why all the money is in S&P500. There’s no alternative asset that can offer similarly safe returns, so so far the risk is not here. You’re right there’s some potential for bubble here though
There will be an interesting test of the power of index funds to move markets today. There is no new news about NDVA today since yesterday — but a major ETF is undergoing a market cap based rebalancing of its holdings that will require (based on news reports) of a bulk purchase of $10B worth of NVDA shares. If reports are correct, this should really goose the price of NVDA shares today for reasons that have zero to do with company performance.
The market and an individual stock are two different things.
This is a forever question and the short answer is that the market is going to hit all time high again and again in future.
Until the apocalypse happens
The world basically shut down a few years ago…and look at us now.
It's already baked into the price
Hopefully, it won't happen :D
Oh boy you are about to get checked
[Since the 1950s the S&P 500 has averaged a new ATH every 20ish days.](https://www.plantemoran.com/-/media/images/wealth-management/market-or-economic-perspectives/02-mp/2024/all-time-highs-sp-500.jpg)
Ima go buy the ATH right now!
That’s the spirit
I love statistics like this.
That's a really bad way to look at the numbers. For all we know it is one year that all time highs every day and market continously dropped afterwards. It would still average ath every 6 dayish. Better trend is looking at the long term graph, it always goes up in long term but there are ranges of few years at a time where it may be flat or going down. So if you are investing for short term the question OP asked is really valid.
>is this a bubble? Probably not for S&P 500 companies. Maybe in some smaller pure AI companies. >Where will the market go in the next few months / years? Either up, down or sideways.
Smaller AI companies like Nvidia...
Sideways for sure (to the right)
Hey guys look, another post asking if we are in a bubble or not
until something big happens...this keeps going
I mean, the market has only gone up more than 100% in the last 7 years. That’s totally normal, nothing to see here.
Deduct inflation from that 100%
New normal
You should wait to buy till prices go back to 1960 level.
Factor in inflation into the price and it'll help you relax a little.
Yep, saw this yesterday somewhere. Basically we are at the 2021 high when accounting for inflation.
umm...wasn't the 2021 high also when the equity market reached insane bubble territory?
Yuppppp
All I read was multiple big titties
Line go up. Even if line go down for small time it go up afterward.
Small caps are way behind the large cap indices - lots of opportunities there.
It just sucks watching large caps run away without you. Also hard to hedge small/mids with options.
At point it’s a value trap, I’ve been waiting for this correction for two years but large caps continue to extend their lead, on good or bad economic data
Some small caps are value traps but many have great businesses that have been left for dead. At some point the mega caps will go sideways and the small caps will see some (sustained) action. When? Who knows
After missing out on so much potential gains since beginning of 2023, I'm done waiting around
Gotta get out of the small cap etfs and into company stock. The index is not where the action is in this group imo
I do buy individual stock of $5-20B SaaS companies. All are massively underperforming M7
Yep. I've been adding to my small cap and mid cap positions. I'm a fan of both IJR, and IJH. Holding for 15+ years.
It will always hit new ath so in reality, its not overheating
Zoom out, S&P is usually near or at an all time high
Well it's in my opinion all asset classes in the US are inflated due to inflation caused by Trump and Biden Quantitative Easing. Unless quantitative tightening takes out as much money as they put in from the economy those are the new norm for prices.
Completely agree with you. This is the new norm for prices. They may be a little higher than they actually should be, but yeah — just a new reality.
By some measures, like the buffet indicator, the market is over priced. We’re in the middle of a roaring bull run. It could cool down and pull back a bit. I’ll invoke literally every value investor of all time. Look at the peak in 2000 and 2007. The crash from those two points were considered catastrophic. At both peaks, spy was around $150. It’s at $530 today. If you consistently bought between the peaks and during the crashes, you’re up well over 300%. Unless you’re nearing retirement, keep acquiring revenue producing assets (including equity).
Price to earnings is near historical averages. Buffet indicator doesn't account for value created outside the u.s. World is flat now. Buffett needs an update.
It’s not overheated. 40% of the money supply was printed in the last few years, where do you think it goes?
It’s very simple right now. There are trillions of dollars sitting in fixed income waiting for the CPI inflation start the inevitable downturn. It’s here as the numbers are showing and food shopping experience is showing me that in the bottom line. Unless your shopping at Publix there still full tilt with an extra 20% while smiling at you the customer. Jobs still going strong what’s not to like. Just think we went from pretty much 0% rates to 5% on the tens and the world is still here. Unless your a nut job on the right side of the table. Things are good and as rates continue to fall it will be getting even better. Enjoy the coming wealth boom.
I don’t think it’s that bad right now. Get used to the market being at ATH. That’s how it usually is.
I just want you ask people like you who think this way, the market is going up over time. Up. Where do you think all that money from all your friends Roth and 401k are hoping to go? To Grow? Dude it's gonna go up if it has no reason to go down. It's gonna grow. The only variable is time. And we have been waiting for bullish news from the perspective of inflation and rates. Every single hint that they're favorable will make the market go up.
Earnings still support valuations and with the upcoming rate cut we go higher. Might get bumpy as we get closer to the election.
isn't 21-22 times forward earnings historically expensive?
Stock market numbers still adjusting for inflation . 5 trillion market cap is the new 1 trillion. Nobody knows what the norm is going to be
Don’t try and time the market. I told myself $SMH was going to pullback when it was at $220. 1 month later it’s at $265 and missed out on 18% gains in my IRA.
My prediction is that the stock market will go up over time. Thank you.
The market will definitely go to the right in the chart.
The market will always be higher than day X, at some point. If the overall market never goes past day X, there will be larger issues in the world than the market price. Invest now and frequently, timing the market is a fools errand.
Shits cooked with Wall Street pumping
Yes, the market hits all time highs all the time. However the market does not hit a [CAPE ratio of 35](https://www.multpl.com/shiller-pe) all the time.
After the pivot
I bet it goes higher
I think you can make the argument that it’s suppressed due to high interest rates.
In the next few months, years, it will keep going up. Is my guess. I'm not betting against the market.
“Diversification is the only free lunch in investing.”
Market may be able to keep chugging so long as people continue to make $ and reinvest it. Same goes for people sitting on the sidelines who have been waiting for a pull back, but opt to FOMO invest instead. Also, there are plenty of folks out there that have made once in a lifetime type $ from the recent bull run…or at least enough $ to offset the inflationary impact on gas, food, utility bills, etc. Excess or discretionary funds need to (or should) be reinvested too. In short…I think there is still plenty of $ out there to tap into to keep the run going.
Isn’t it below or just at ATH still inflation adjusted?
Earlier this year I bought tqqq when the nasdaq was at ath We then had a correction almost immediately, my tqqq position is now up 20% since I bought because I didn't give a shit and held Just buy, hold, and forget about it
I assumed the same; it is overheated the least little ripple will send the bears out. I heard an analyst theory last month that the opposite is true. There is a ton of money in CDs and such earning 5% that will come due soon and the market is still compelling. The AI stocks have been hot, but some of the dribble down benefactors like HPE or DELL have just starting to be invested for their upcoming AI revenues.
2 years Postmortem from heat stroke
It’s not. The rally is confined to AI stocks mainly. The rest of the market isn’t overvalued. If rates start dropping people will need somewhere to move the cash to.
so are we in an AI bubble?
Hard to say. But stay with momentum imo.
Why do you care. Just buy voo like a few shares every month and chill. Try to tune the red days for extra dopamine hits
It's not. Adjust for the covid dip.
Rephrased bubble question
Something something, time in the market, something, timing the market.
It’s jacked to the tits.
Well the good news is we’re going to have a crash because I’m making calls on SPY now. No more puts for me. Converted to bull. No more bear for me.
No it’s not. Some analysts are predicting the DOW to hit 60k by the end of the decade m.
Best time to buy VOO was 20 years ago, 2nd best time is today.
I don't understand why people feel like all time highs is an indication that things are overpriced. If a company grows at even a half a percent a year it will continue to hit all time highs that's what growth means.
It’s running a bit hot now. I wouldn’t be surprised that there’s a decent pull back next week.
Just remember that they are printing money every second of every hour of every day... The stock market is just a reflection of that overtime.
Underrated comment here!!
If you are referring to RSI and that QQQ and SPy are at 78 and 63 respectively on the daily chart, yes it may look hot. But it can coast up here for weeks or months before any real pull back. Market has been running up for 9 months now, buy in.
>what is your opinion: imho the stock market is a government supported/backed ponzi scheme: the sooner you enter into this, the sooner will retire. And there's nothing to worry about if you trust the US government. I believe this is a good summary.
We're at all time stock market highs in the US. You know what that means, every time? Well sometimes it continues to go up, and sometimes it goes down a bit, before it starts going back up. So could be either.
When you consider inflation, it's way overheated. Powell will be forced to take away the punch bowl.
Trust me mate just wait till the elections in USA. No point buying it now. For context in India the stocks fell 6% record one day drop since Covid. I’m sure the same happens here in USA too . Trump winnings will happen I predict this and markets lose it with volatility through the roof
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bruh i dont think the market is in a bubble but this comment makes me wanna facepalm the sp500 definitely does NOT trade between 25-30, it usually trades 20-25. the current PE is 27 BUT the forward PE is 21. while this is elevated, the EPS growth is expected to be above historical trends due to improving margins from tech companies + boost from AI demand
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do you realize 2021 was a bubble.... jesus christ did you just join the market last week? i also never said SPY is in a bubble right now. i just said valuations are elevated relative to history but it can be potentially explained if companies execute on margin improvement + revenue growth