Thunder Good-Oil
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I think that the cap weighted averages coupled with the enormous valuations of a relatively few stocks (mainly the MAG 7) distorts the comparison. The sector valuations were more in alignment with each other 100 years ago. Today NVDA is around 60x and TSLA 175x while JPM and Goldman are about 15x.
There might could be a bubble. But there’s also a lot of FOMO driving a minority of companies extremely high instead of normal rotations to lagging sectors and industries. Also, funds flush with cash weren’t such a big thing in the 1920s. Regulations and accounting standards were also archaic or non-existent.
There might could be a bubble. But there’s also a lot of FOMO driving a minority of companies extremely high instead of normal rotations to lagging sectors and industries. Also, funds flush with cash weren’t such a big thing in the 1920s. Regulations and accounting standards were also archaic or non-existent.