Ask The Compound

Is This a Bubble?

25 snips
Sep 3, 2025
Bill Sweet, a seasoned Chief Financial Officer, shares his savvy insights on navigating today's financial landscape. He discusses the potential bubble in the U.S. stock market and how historical PE ratios can guide investment strategies. Sweet dives into the quirks of Roth IRAs versus 401(k)s, revealing surprising trends in retirement participation. He also humorously explores the forgotten financial accounts of lottery winners, advocating for wiser investment choices over mere chance. Tune in for tips on balancing portfolios and uncovering the hidden costs of tariffs!
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INSIGHT

Regression To The Mean Is Tricky

  • Regression to the mean can be slow, disrupted, or shift to a new normal depending on structural changes.
  • Ben Carlson warns that historical averages may move as the economy and corporate structure change.
INSIGHT

Higher Margins Support Higher Valuations

  • Corporate profit margins have risen over recent decades due to technology and intangible assets.
  • Ben Carlson argues modern firms are more efficient, which supports higher valuations than older capital-intensive industries.
INSIGHT

Valuation Concentration In Mega Caps

  • Elevated market valuations are concentrated in mega-cap tech stocks rather than the entire market.
  • Ben Carlson notes the top 10 S&P names carry disproportionate valuation pressure versus the other 490 stocks.
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