Search Results for: hussman

Of all the arguments for a significantly bearish outlook, I find John Hussman’s chart of estimated future equity returns, shown below, to be among the most compelling.  I’ve spent a lot of time trying to figure out what is going … Continue reading →

Mean-reversion in a system doesn’t happen simply for the sake of happening.  It happens because forces in the system cause it to happen.  With respect to profit margins, the following questions emerge: What are the forces that cause profit margins to … Continue reading →

In the debate on profit margins, two different types of charts frequently appear.  The first chart is a chart of the aggregate profit margin of the S&P 500. Valuation bulls tend to prefer this chart because it undermines the view … Continue reading →

James Montier of GMO, whose work I deeply respect and enjoy reading, recently put out a white paper defending the Shiller CAPE from some of the attacks that have been waged against it.  He offered a number of strong arguments. … Continue reading →

Is the U.S. stock market expensive?  To answer the question, we need to get precise about what we mean by “expensive.”  Expensive relative to what?  When valuation bears say that the stock market is expensive, they usually mean “expensive relative … Continue reading →

In this piece, I’m going to address three responses to my earlier piece on the Shiller CAPE. First, a response from Peter Atwater of Financial Insyghts.  Second, a response from John Rekenthaler of Morningstar.  Third, a response from Bill Hester … Continue reading →

My prior piece on asset supply has received significant interest, and so I feel an obligation to clarify.  The title, “The Single Greatest Predictor of Future Stock Market Returns”, was something of an intentional exaggeration, chosen not only to draw attention to … Continue reading →

John Hussman recently tweeted an interesting chart showing a Sornette-type bubble developing on the S&P 500: Well done, but I don’t think investors should be anticipating a crash any time soon. Historically, major asset bubble crashes have always been preceded by rising … Continue reading →