Subject: Re: OT: S&P 500 Valuation
'In 1982 the market was trading at 5.9 times smoothed real earnings.
In 2000 the market was trading at 42.6 times smoothed real earnings.
What's strange is not the variation as such, but that each of those was considered normal at the time--each extreme was, almost axiomatically, the world's consensus.'

Great zoom out and thank you for taking the time to share it.

The extremes in market valuation, over very long periods of time are just so interesting. It causes me to think of the buyers and sellers as different groups of individuals and organisations.

So many ways to categorise using attributes, with all kinds of combinations. No doubt there is research out there.

Length of time in the game?

Longest held stock?

Concentration by decade?

Realised losses >10%

Realised losses as % of net worth?

Biggest % gains?

Biggest % dollars gains realised and unrealised?

Managing own funds or others?

Use of leverage and what kind?

% charge for managing other people's money?

Net wealth created for others in relation to own net worth?

Consumption/lifestyle over the years?

Investors style by decade (value, quality, momentum, investor, trader etc.)?

CAGR over 1, 5, 10, 20, 50 years?

Inherited wealth?

How was the first $1M was made?

Net worth by age adjusted for inflation?

No doubt, there are important questions I have omitted.

I was thinking about Buffett writing those questions. It would be interesting to me, at least, to consider how all the different market participants, (over those years since 1982 and back to when Buffett started) would answer the questions.

Here we are in 2023. The correction of 2022 has reversed somewhat. The world is still awash with liquidity. The notion that intrinsic value is linked to PV of FCF is deeply out of fashion. The world is incredibly uncertain almost everywhere. Few have any clue about what lies ahead, for markets, or the world.

Maybe Buffett is wrong. Maybe meme stock day trading with leverage is the way forward. Or crypto. Or taking advice from CNBC. Who knows.

As for me, I plan to compare myself to Buffett and try to move closer in his direction, in the areas that make sense for me, as an individual, not managing other people's money.

After decades studying Buffett, it is always pretty clear, when I ask myself: what would Buffett do, if he was you. There is no one like him.