Are Stocks In A Bubble Or Boom?

The velocity of the S&P 500 Index’s 35% rally from the April lows has taken many investors by surprise, including us. Nearly all traditional valuation metrics suggest the market is expensive: the forward (next-12-month) P/E recently stood at 22.8x, a level previously only witnessed during the tech bubble of the late 1990s. While some signs of froth are certainly evident, other factors suggest the market’s recent advance is grounded in a favorable policy mix that supports improving fundamentals, or perhaps e ...