It’s the P/E ratio (the ration between the stock Price of a company and it’s Earnings) of the Nasdaq vs the Price.
Notice how the Nasdaq price has tracked the P/E, with since at least 2002 the stock prices not increasing because company earnings are going up but rather just from increased speculation hence the rise in the the ratio of stock Prices to Earnings.
The P/E now (i.e. company valuations relative to the actual money a company makes) is now about twice as much as back in 2020.
Here’s an even more interesting one:
It’s the P/E ratio (the ration between the stock Price of a company and it’s Earnings) of the Nasdaq vs the Price.
Notice how the Nasdaq price has tracked the P/E, with since at least 2002 the stock prices not increasing because company earnings are going up but rather just from increased speculation hence the rise in the the ratio of stock Prices to Earnings.
The P/E now (i.e. company valuations relative to the actual money a company makes) is now about twice as much as back in 2020.
Wow that’s a pretty wild statistic here. Is there historical precedent for this?
S&P 500 PE Ratio hit 120 in 2008, but thats because earnings collapsed.