Schiller PE ratio is a high..around 30 which is nearly double the historical mean of ~17. That is an indication that stocks might be overvalued. Only two times it's been higher, and those weren't good times for the stock market (1929, 1999)

I think a lot of the runup is where else are you going to put your money? Bonds? overseas? I think the market is rich, but I see a slide down earnines or stagnation til earning catch up instead of a crash.

Really good points. I sold my financial stocks yesterday and now I am sitting on a pile of cash. It's not earning jack but I didn't lose my shirt either. I keep watching wages stagnate and wonder when Joe Worker is going to get a break:

"The Bureau of Labor Statistics recently released data that highlight wage stagnation for U.S. workers from January 2016 to January 2017. According to the BLS, wages for all employees remained flat but included a 0.6 percent drop in workweek reduction which led to a 0.6 percent wage reduction for the report period."

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"The great pleasure in life is doing what people say you cannot do."

Exactly, ~2 years ago it got really choppy, as it was felt to be overvalued until the recent runup. There is an enormous amount of wealth on the sidelines, and a lot of it is waiting to be invested on major dips. I would expect fluctuations and sideways action, unless some major panic/recession hits. That said, if you aren't sitting on really big money, what are you going to do?

I think he meant corporate earnings. Which have a more direct influence on stock value. Corporate earnings and mean wage have been essentially decoupled for decades now.

My personal position has been clear on this thread for years. I'm in stocks, only stocks, and I'm not getting out. Well, there's no out in sight right now.
At least I've been very transparent about that for the people that will listen.

This could be a 15% to 20% year.

All the "bubble warriors" are fighting the last war instead of the next one.

Wait a minute - we are at some form of peak economic bubble?

But Trump says the economy is "terrible". "Worst ever", on many fronts he says.

There's a bit of a disconnect there!

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Steve Fleck @stevefleck | Blog

Pretty sure you have no idea what we're discussing. Go have a popsicle and leave the discussion to the adults.

Time to buy Bitcoin














5 minutes later...









Maybe not.

Not all of them. Any year could see a run-up, or a significant dip. I've been all in since 2009, except that I pulled out some in 2015 to help my mom keep and fix her house, which I just sold for her at a 50% mark-up. You are in good company by just staying in, the risks to the entire economy are so great that governments seem endlessly committed to propping up markets at all costs. Can't predict when or if it will end.

You charged your own mother time and materials? =)

These types of comments always leave me shaking my head. How does a government "prop up" a market? Is that the same way they "prop up" human rights? Or maybe the same way they "prop up" a judicial branch? Should we expect governments to take actions to destroy those things? That statement makes it sound like a government trying to be competent is a new, but corrupt and sad thing.

By buying $3.5T in private debt and offering interest free loans to the rich. :)

I get your point, and agree, just throwing that out there, though.

Exactly, "propping up" a market or industry or "too big to fail" company or a sector of the economy may make sense for any number of reasons and be "competent" policy (and I supported a lot of actions in the wake of the 2008 collapse), but in the end, the willingness to step in can remove risk and allows for speculation.... Many of my friends have become pretty wealthy by understanding that governmental policy is one of the most vital variables in investing.

I realize that you and trail are mostly yanking my chain, but it's the LR so we might as well have an interesting discussion...

The problem with the point of view you are presenting here is that it plays fast and loose with the real drivers of value in the market. It stirs up in the reader's mind components of the economy that are best left unstirred. The market and the economy of the United States is based primarily upon the people's ability to produce and consume goods and services -- not government action. Yes, we have a monetary system, along with a banking system, along with a federal reserve. Those systems allow us to trade efficiently, and, if they froze up, would create a real issue. However, the gov't working to keep this system running smoothly is not the same thing as creating artificial value in the markets (as "propping up" would imply).

I would think that you two would appreciate this viewpoint because the reality is it's used by conservatives to denigrate our economy -- yeah, it's all a funny-money fed created bubble! -- much more than by centrists.