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24-03-2014, 06:51 PM
But you know some times the market can be slightly over value or slightly under valued.
The fact that it grew from a very low base suggests why it has gained so much for the last few years. It should not guide us into selling and timing for tops should it?
Of course a relevant measure that buffett said before was total market valuation/gnp shows only a slight overvaluation.
I understand the concerns about low interest rate boosting valuations with corporate profits still not capturing up.
But does it really necessitate us into saying this is the top?
Isnt it the case that because there are no extreme valuation and that equity prices some times have no relevance to economic numbers suggests we should just go back to the bottom up analysis and just dig there for undervalued stocks and be macro agnostic?
btw i say equity prices have no relevance to economic numbers bcos Buffett was with Gates one time at HBS said quoted an instances where there was recession in the US economy from 1953 to 1954 Nov. Yet during this time, equity prices rose the highest in history (something along 40% i believe).
The fact that it grew from a very low base suggests why it has gained so much for the last few years. It should not guide us into selling and timing for tops should it?
Of course a relevant measure that buffett said before was total market valuation/gnp shows only a slight overvaluation.
I understand the concerns about low interest rate boosting valuations with corporate profits still not capturing up.
But does it really necessitate us into saying this is the top?
Isnt it the case that because there are no extreme valuation and that equity prices some times have no relevance to economic numbers suggests we should just go back to the bottom up analysis and just dig there for undervalued stocks and be macro agnostic?
btw i say equity prices have no relevance to economic numbers bcos Buffett was with Gates one time at HBS said quoted an instances where there was recession in the US economy from 1953 to 1954 Nov. Yet during this time, equity prices rose the highest in history (something along 40% i believe).