Warren Buffett’s preferred market gauge has jumped to its highest level since October 2007, suggesting worldwide stocks are the most overvalued since the financial crisis.
“Buffett indicator sounds the alarm,” Welt market analyst Holger Zschaepitz tweeted. “Global stock mkt cap has now topped 120% of global GDP, and thus the same level as before the crash in 2008.”
Buffett described the indicator in 2001 as “probably the best single measure of where valuations stand at any given moment.”
The famed investor said it “should have been a very strong warning signal” when the indicator hit a fresh high before the dot-com bubble burst.
