The biggest problem in a market where everything is expensive

Business Insider CEO Henry Blodget looks at President Donald Trump’s claims that he’s responsible for the record-setting stock market, and finds that the S&P 500 rose just as much over the first 11 months of Barack Obama’s second term. Blodget also provides a bearish argument, which suggests that high valuations have historically preceded periods of market weakness. He also points out that prices are high across many different asset types, which means that diversification might not help investors out right now. He then highlights a chart cited by John Hussman, the president of the Hussman Investment Trust, which shows that the expected return on a diversified portfolio is low at the moment. Business Insider executive editor Sara Silverstein goes on to say that the search for yield across all asset classes worries her.

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.