How Extreme is the Market’s Current CAPE


This week brings a public service announcement.
With the Shiller PE ratio currently over 31, what does this mean for your retirement?

While Bianco has a more conservative view of extreme (and many other economists are also quick to debate Shiller’s metric), the Shiller PE is actually at a fairly extreme level. Only in 3% of market history has the CAPE been higher.

While this certainly suggests markets are directionally high (especially for aspiring, soon-to-be early retirees), the fact that only 3% of history is available to sample from (only 53 months out of a total 1761 months of data) suggests a huge degree of uncertainty.

The “Random Walk” may be even less predictable today than usual…

Fincon17 or “How I Learned to Stop Worrying and Love the Bomb”

Preparations for my first Fincon

With the start date of my first Fincon only weeks away, I can’t help but reassess this decision. Is this still a good idea? Will my time and money be wellspent?

Continue reading “Fincon17 or “How I Learned to Stop Worrying and Love the Bomb””