With the S&P500 median P/E multiple at the 99 percentile of all historical valuations, as even Goldman highlights month after month...
... it appears even the Fed has figured out that the only source of upside for the "market" has been unprecedented multiple expansion:
... during the discussion, several participants commented on a few developments, including potential overvaluation in the market for CRE, the elevated level of equity values relative to expected earnings, and the incentives for investors to reach for yield in an environment of continued low interest rates.
Well, not "the Fed" - just "several participants."
And following the brief "discussion", everyone solemnly nodded and moved on to more important topics, like what's for lunch.
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And just in case, there is something to this observation, here is Goldman's David Kostin explaining a month ago, how "The Last Two Times P/E Multiples Expanded This Much, The Result Was A Historic Crash":
The current P/E expansion cycle is now one of the largest in history. Since September 2011, S&P 500 forward P/E has grown by 75% (from 10x to 18x). This expansion has only been surpassed twice since 1976, when the multiple rose by 111% from 1984-1987 (ending with the 22% Black Monday collapse) and by 115% from 1994-1999 (ending with the Tech Bubble pop). During the nine previous P/E expansion cycles the multiple typically climbed by 50%.
As we said a months ago, "Thanks, David, we get it. It's going to end very badly. Just maybe tell your friend Bill Dudley to stop pushing it ever higher and assuring the resulting crash will be that much worse, maybe?"
So far, Bill Dudley has not gotten the memo.