Overview
- The market-cap-to-GDP gauge has climbed to about 220.1%, topping its 2021 peak and far above the roughly 110%–150% range of the past decade.
- Research from Capital Economics and Goldman Sachs outlines downside scenarios for the S&P 500, including double-digit declines if profit growth underwhelms.
- Major indexes have steadied after a tech-led pullback, yet valuation measures suggest equities remain stretched and sensitive to earnings surprises.
- Warren Buffett’s playbook of building cash in expensive markets is in focus, with some reports putting Berkshire Hathaway’s reserves near $380 billion.
- Valuations are uneven beneath the surface, with Trex cited as a cheaper example after a drop of more than 35% and a price-to-earnings ratio near 23, below its long-term average.