How Well Does the “Buffett Indicator” Predict Market Crashes?

The “Buffett Indicator” is the ratio of total US stock market capitalization to US Gross Domestic Product (GDP). Named after Warren Buffett, the “Oracle of Omaha” once called this ratio “the best single measure of where valuations stand at any given moment.” According to Buffett and the indicator, values above 100% signal overvaluation for US … Continued

Do Inverted Yield Spreads Really Predict Market Crashes?

Inverted yield spreads are among the most widely-followed indicators for predicting economic recessions. In fact, an inverted yield curve has preceded every US recession since 1955. But how effectively can inverted yield spreads be used to predict stock market declines?  In our latest white paper, Which Leading Indicators Best Predict Market Declines?, we analyzed the … Continued