The Prices Are Not Alright

When you pump $12.3 trillion (and counting) into an economy, things are going to inflate. For example, commodities are going to be more expensive. Take a look at the vertical leap in prices for copper. And lumber. Home prices themselves become bubbly. Home prices have...

Will Cap Gain Tax Hikes Burst The Stock Bubble?

The United States government raised taxes to finance the debt that accrued in World War I and World War II. Today, we are not engaged in a military intervention of monumental magnitude. However, the public debt-to-GDP is greater now than at any other point in American...

Never Has Anyone Ever

Private money management firms often sell at a multiple of revenue. A frequently talked about metric? Price-to-revenue. For example, a wealth management company that generated $1,000,000 over the last year might be valued at 2.25x, or $2,250,000. At least in the...

Lucky 13

On April 13, 2021, the S&P 500 SPDR Trust (SPY) closed above its opening price for the 13th consecutive session. That has never happened in the 28-year history of the exchange-traded fund. Without question, enthusiasm for stocks is feverish. But is it rational?...

In Excess

When does extraordinary excess become visible? In hindsight. Consider the stock market at the start of 2000. Despite ridiculous valuations, scores of profitless IPOs, and an absence of common sense, few seemed to recognize the risks ahead of time. The S&P 500...