Subject: OT: The bubble has not popped
Chart of Global Value Spreads from Cliff Asness:

https://www.aqr.com/Insights/P...

This post updates the value spread chronicled in our series of posts dating back to December 2021 with data through 12/31/2022. The fourth quarter of 2022 saw value recover from the bout of temporary insanity that gripped some portion of the market over the summer, but the spread ends 2022 very much still in rarified territory ' at the 94th percentile, to be precise. More excitingly for 2023, value's returns in 2022 were extremely strong, and the spread only moved from roughly the 100th percentile to the 94th. I will say again that a massive valuation dislocation says very little about the timing of when it truly falls back to earth, but we're very optimistic about the prospects of continued normalization in 2023 and beyond. Like in 2022, there's sure to be nasty reversals along the way, but as Wile E. Coyote always finds out, gravity is inescapable.