Subject: Re: BRK, the VL is out, if you can read it.
paying a low multiple of pretty-darned-sure future earnings
...
"Multiple" of "earnings"? That's 20eth century talk.
People making real money in the last 15 years are the ones gambling in "assets" with zero cash flows and some indeterminate high terminal "value".
Sorry for all the quotation marks, but the bitcoiners, memecouners, meme stock guys are the retail "investors" (quotes again) who have made real money.
Next tier is those who invested in large cap US growth stocks at nosebleed valuations 5-10-15-20 years ago.
Value investors calculating multiples and earnings are beginning to resemble madhouse residents mumbling to themselves about the real reality and how the rest of the world has gone mad, not they.

Though I appreciate that your comment is partly tongue-in-cheek, I think you're pretty far off the mark about the equities...bearing in mind that the key word in my comment is "future" earnings.

For example, in the last decade, investors in firms like Microsoft, Google/Alphabet, Facebook/Meta, and even Netflix have done very well.
But were they at nosebleed valuation levels a decade ago? Not at all, because of the word "future". Their average trailing earnings yield equated to P/E ratio of 44 a decade ago, but they were all trading at only 4.2-5.4 times their respective average earnings per share in the last three years. (Apple too, the only difference being that it was also cheap on trailing earnings at the start). You'll generally get an above-average return buying at any multiple of (say) 8-year-forward earnings under 10x. In short, they were trading at less than half of fair price.

The second most important part of that comment is the "pretty-darned-sure" part: future earnings haven't happened yet. You'd have had to know each business pretty well to estimate with confidence the earnings trajectory that we've seen. Many people bought those stocks for bad reasons or no reason at all, but those who did estimate the forward trajectory correctly were value investors, not speculators, because they were really cheap. And, to the point, value investing therefore worked spectacularly. With few exceptions, the only time it fails are those times that one's estimate of value (almost always EPV) 5-10 years later are off. The most common cause of THAT is people who aren't estimating years-forward earnings, or overestimating the relevance of trailing earnings in doing that estimate.

Perhaps a P/E ratio seems old fashioned or arbitrary, but the best way to think of it is this: "If the market closed, how many years would it take for the owner earnings to make back my purchase price?" This emphasizes that the important thing is the sum of all future earnings, not last year's. A possible rule of thumb is that this should not exceed your life expectancy!

As for the speculators who have made tons of money on a mark-to-market basis lately by speculating in the prices of non-earnings assets, well, prices do go up and down. Those profits definitely exist...but only for those who have sold. I imagine there will be some fat ladies singing in the next decade, and that the population of big winners with closed positions will be modest. The main result won't be a lot of aggregate profit, it will be a lot of transfer of wealth from the gullible to the cynical. And, to be fair, to the price speculators who are neither, merely above averagely nimble in the timing and luck of their exit.

To take a single but important example, the buying power of a bitcoin will top out at some point. As with any non-earning capital good, its price rises only if aggregate demand rises faster than supply, and aggregate demand has to top out at some point, even if (say) the US treasury starts printing dollars to buy them. Since essentially every holder of a coin is holding it for no reason other than the expectation that its price will rise, once the price tops out the sole reason to hold it will be entirely in the past. Some people will realize that quickly, and some will realize it slowly, so the main effect of the whole exercise will be the transfer of actual wealth from the latter to the former. Plus the precisely balancing wins and losses of short term holders during various sub-periods.

Jim