How is the real economy doing where you live???.............I recently heard a short interview with Robert Shiller regarding the markets. He basically said what most wise economists/investors say, he does not know where the market is going and his CAPE ratio could break 40 before we would see any significant decline. This is interesting because the only time it broke 40 was during the craziness of the dot.com bubble. I live in the San Francisco bay area, and there is definitely ridiculous real estate prices with foreign investing and the rise of social media, but I do not see the same fever we were feeling during the dot.com bubble and there is already a lot of talk about private equity starting to pull back a bit. So I find this kind of bubble a very unlikely possibility.
I have not looked at all the major market measurements for a month or so, but last I looked, the q ratio, market to gdp and the shiller p/e were all showing an overvalued market. Maybe one indicator is not reliable but when we have three indicators saying the same thing it does seem more informative.
Obviously most politicians (except maybe Trump- lol) and the talking heads on financial television are out of touch with the real economy. Interest rates cannot get much lower to boost the market and it sounds like the fed will not revive qe unless there is some catastrophic event so we really need to depend on the growth of consumer spending which makes up roughly 70% of the market in order to see further long term growth of the U.S. stock market. From the little I have heard from people living in other places in the U.S., a lot of people are still struggling...........so how are folks doing where you live? Happy Friday people