Wall St optimism heading into 2021 means the S&P500 trades on a trailing PE of > 25X (Exhibit 10), a level only exceeded in 1921 and 1999. The capitulation of consensus to “don’t fight the Fed”, front-running MMT, secular tech-led productivity…many catalysts exist for more years of big equity gains…but an old-fashioned bubble remains most plausible catalyst.
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