Obviously we can't call the top... We've done a really bad job.
But as a group do we possess the collective knowledge to decide if certain markets are at least over valued?
There's much talk of stuff being over priced and about to collapse. But is there?
It seems most manufacturers have more demand than product atm. I don't see that changing in the near future. Additionally labor rates are going up and so is inflation. It seems the S&P and at a larger level total market funds are the top place to park cash atm? At least until there is an absurd valuation like the one Tesla has atm.
Maybe I'm too optimistic.... "Be fearful when others are greedy, and greedy when others are fearful".
I feel like people are trending towards fearful.
There is a larger question lurking in there, namely "What does overvalued mean?" And the answer to that question is that higher than typical valuations imply lower than typical future rates of return. BFD. We all already knew the stock market can go sideways for long periods of time.
Higher than typical valuations
do not imply a crash is around the corner. To be sure, I can say with 100% certainty a crash is coming, but I don't now when or how big, and neither does anybody else. But even that doesn't matter. All of us here have investing horizons of many decades. Even if you are in your 60s, you likely will live until late 80s or 90s. During that time there will be many corrections and many recoveries. If you are in your 40s, then your horizon might easily be half a century. A market crash now won't matter one whit over that period of time.
Time for a couple quotes:
“Far more money has been lost by investors trying to anticipate corrections, than lost in the corrections themselves.”
--Peter Lynch
“The idea that a bell rings to signal when to get into or out of the stock market is simply not credible. After nearly fifty years in this business, I don’t know anybody who has done it successfully and consistently. I don’t even know anybody who knows anybody who has.”
--Jack Bogle