R59, S&P amazing run since 3500
Over 40% higher now in 15 months. The one thing that keeps me strongly in 4%-5% fixed income is, S&P earnings have been flat for 10 straight quarters, yet PEs in the S&P have expanded to 22 going forward vs 16 historically. In order to want to be in the stock market. I have to feel the market is healthy, but I feel nothing of the kind. AI and the Fab 7 have represented 90% of the S&P gains, so to me, the last 15 months has been more like a bear market rally, driven by AI hype, than anything. Consumers are not healthy, just because they keep spending, as $1.2T in credit card debt, and record delinquencies speak loud and clear to me. In fact, I'm still in the camp, that the yield curve will still be right this time, and that a recession will happen over the next 3-4 months.
R59, while you're right that the market can't be timed, we know when it's acting rationally or not, and I believe it's acting highly irrational right now. If you feel differently, please tell me how S&P 22-23 PE going forward is warranted ? I mean what great event will spike us into a new bull market, making the present ridiculous PEs make any sense ?
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