A Bubble in Fundamentals

In the spring of 2013, the S&P 500 made a new all-time high for the first time since October 2007. Around that time, I remember seeing people use the b-word to describe what was happening.

The chart below, which shows Google searches for “Stock market bubble,” validates my memory.

Stocks have been rising over the last decade because businesses have been making more money for their shareholders. That sounds overly simplistic, but that’s just about all you need to know.

Last week Howard Silverblatt tweeted that for the first time, S&P 500 quarterly cash-flow will exceed $500 billion.

You don’t have to be Captain Sherlock to find bubbles today. They’re hiding in plain sight. But just because there are bubbles in the stock market, that doesn’t mean the overall stock market is in a bubble.

I spoke about this and much more on the newest edition of The Compound and Friends with Josh and Sam Ro.

Links from the show

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Bitcoin Miami

Tim Dillon on stage 

Jay Woods on Circuit Breakers

Rising wages

Inflation numbers

75 years of advertising

Millennial subsidies