Key Points Only during the dot-com bubble period was this data point higher than it is right now, which might not bode well for future market returns. Today's stock market is being driven by dominant technology companies that have very favorable qualities. Ongoing currency debasement is an underappreciated tailwind that can continue to lift stocks higher. 10 stocks we like better than S&P 500 Index › Over its entire history, the S&P 500 (SNPINDEX: ^GSPC) has put together an average yearly return ...

However, the study in question came from the Coalition for a Prosperous America (CPA), an advocacy group whose representation of U.S. manufacturers gives it a clear reason to favor protectionist trade policies. The World Trade Institute, an academic research group, said the CPA study used "highly unusual and empirically unsupported" methods to generate the result the authors desired. In other words, the study lacks credibility.In February, the White House published a "fact sheet" crafted to ease concerns ab ...

Warren Buffett's Berkshire Hathaway has been a net seller of stocks for 12 consecutive quarters despite having a tremendous amount of investable cash.Berkshire Hathaway (BRK.A 0.28%) (BRK.B 0.60%) shares have increased over 5,500,000% since Warren Buffett assumed control in 1965, compounding at 20% annually. His patient, value-oriented approach to investing has been indispensable in achieving that success. The company has a stock portfolio worth more than $300 billion.Ominously, Buffett and his fellow inves ...

Core Viewpoint - The S&P 500 has increased by 16% year to date, driven by the AI revolution, strong earnings, and a resilient economy, but it has recently indicated a potential downturn similar to the dot-com bubble collapse in 2000 [2][9] Valuation Metrics - The S&P 500's cyclically adjusted price-to-earnings (CAPE) ratio reached 39.5 in October, marking the highest level in 25 years, indicating a potentially overvalued market [4][6] - The CAPE ratio is based on average inflation-adjusted earnings over the past decade, providing a more stable view of valuation compared to traditional P/E ratios [5] Historical Context - The S&P 500 has only exceeded a CAPE ratio of 39 during two periods in history, with the previous instance occurring in early 1999 before the dot-com bubble burst [6][7] - Historically, the S&P 500 has been at such high valuations for less than 3% of its existence, and these instances have typically preceded significant market declines [7] Future Projections - Despite the high CAPE ratio and concerns about sustainability, Wall Street analysts predict that the S&P 500 could rise by more than 10% in the next year [9] - Historical data shows that after reaching a CAPE ratio above 39, the S&P 500 has experienced varying returns, with potential declines of up to 43% over three years [10]

Group 1 - Berkshire Hathaway has sold a net total of $177 billion in stocks over the last 11 quarters, indicating a shift in investment strategy as the company has been a net seller for this duration [4][5]. - The company currently holds $344 billion in cash and U.S. Treasury bills, suggesting a cautious approach to investing due to elevated stock valuations [6]. - The S&P 500's cyclically adjusted price-to-earnings (CAPE) ratio averaged 38 over the last month, a historically high valuation that has correlated with negative returns in the following years [7][8]. Group 2 - Historical data shows that when the S&P 500's CAPE ratio exceeds 37, the average returns over the next one, two, and three years are typically negative, with expected declines of 3%, 12%, and 14% respectively [9]. - A machine learning algorithm from Moody's indicates a 48% probability of a recession within the next 12 months, highlighting potential economic instability [11]. - The current economic environment is characterized by weakness in the jobs market and uncertainty due to tariffs, suggesting a cautious investment stance is advisable [12].