Why Today's Stock Market Is More Expensive Than NASDAQ 2000 Bubble

Daily Chart February 25th

2/25/2015 – A mixed day with the Dow Jones up 15 points (+0.08%) and the Nasdaq down 1 point (-0.02%).

The stock market continues to perform as forecasted. About two weeks ago I have suggested that a period of low volatility is likely to occur. We are witnessing that today. With that in mind, don’t make the mistake of falling asleep here. According to my mathematical and timing work, volatility will be back with the vengeance shortly. If you would like to find out what happens next and when, please Click Here.

In the meantime, Hillary Clinton paid $300,000 to explain what ails the middle class. No surprise there as our future presidential candidate proceeded to blame new technology and male chauvinist culture for all of our economic problems. The real answer, of course, is not as sexy……a massive Ponzi scheme perpetuated by the FED and the US Government. I told you it wouldn’t be as exciting.

Back to our attempt to illustrate just how out of touch with reality the stock market really is.

I have covered the points in the articles above at least a dozen times over the last few months, yet one persistent assumption remains. Most investors out there believe that today’s valuation levels are nowhere near Nasdaq 2000 levels. The articles above dispel some of that.

With that in mind, I am willing to take it even further. Not only are today’s valuation levels on par with Nasdaq 2000 levels, they are much higher. Here is why. The 10-year note was around 6% in March of 2000. It is at 2% today. If we are to plug 6% into today’s valuation models (not 2%), today’s valuation levels go from incredibly expensive to “the most expensive ever”.

Now, one can argue that we are comparing oranges to apples here. I would have to disagree. If we want to compare today’s valuation levels to 2000 levels, we have to use 2000’s discount rate. It is only then that we realize just how out of touch with reality today’s stock market is. That is to say, there is no way in hell this ends well.

This conclusion is further supported by my mathematical and timing work. It clearly shows a severe bear market between 2014/15-2017. In fact, when it starts it will very quickly retrace most of the gains accrued over the last few years. If you would be interested in learning when the bear market of 2014/15-2017 will start (to the day) and its internal composition, please CLICK HERE.

(***Please Note: A bear market might have started already, I am simply not disclosing this information. Due to my obligations to my Subscribers I am unable to provide you with more exact forecasts. In fact, I am being “Wishy Washy” at best with my FREE daily updates here. If you would be interested in exact forecasts, dates, times and precise daily coverage, please Click Here). Daily Stock Market Update. February 25th, 2015 InvestWithAlex.com

Did you enjoy this article? If so, please share our blog with your friends as we try to get traction. Gratitude!!!