Is the stock market in superbubble territory? How can we protect against a crash?

First, I invite you to visit the Monday Morning website and note a new tab titled “Videos”. Click on that tab and you will see the first of our one-minute videos. This video and all future ones will be short and actionable – big bang for the buck. Call me if you want to discuss any of these. (705-441-4566) Tell others about it.

 Now, some recent revelations:

• Warren Buffett’s Berkshire Hathaway is holding more cash than ever in its entire history.
• Justly famous student of market bubbles, Jeremy Grantham recently stated that the market is in a superbubble and could decline by 50%.
• The market as represented by the S&P 500 is now overvalued by any metric.

Buffett, Grantham and various valuation metrics have stated that the market is overvalued for several years now. During that time Monday Morning members I have done exceptionally well. Following the six habits that Monday Morning encourages, they have nearly doubled their portfolios since 2019.

Buffett and Grantham have not done as well over the last 3 years and further back.

So, how can we protect against a crash?

To his credit, Buffett wants the money that he is leaving his wife in his will to be invested exactly as the Monday Morning method encourages. Many have sensed that outperforming the market is difficult over the long term. John Bogle made that fact actionable by launching the world’s first index fund in 1976.

All investors, even those of limited means, can buy shares of an index fund and outperform over 95% of portfolios over the long term including ones managed by professionals.