Part 2/9:
The current market environment displays several hallmarks of exuberance. Valuations are soaring— the S&P 500’s cyclically adjusted 10-year price-to-earnings (CAPE) ratio now hovers at levels not seen since the dot-com bubble. Meanwhile, initial public offerings (IPOs) are at their most active in over two decades, Bitcoin’s price has rocketed in recent months, and technology giants like Tesla have seen their market capitalizations multiply rapidly over a brief period.