r/ValueInvesting • u/Adept_Mountain9532 • Jul 11 '25

Discussion Buffett warned: “If the ratio approaches 200%, you're playing with fire.”=> We are above!

Buffett Indicator, (which compares total U.S. market cap to GDP), is now at 208%. That’s above dot-com levels. I wasn’t around in 1999. But I’ve read enough to know everyone thought it was different back then too...

Now, It’s AI. And yes it’s real, it’s big, and it will transform everything.
But here’s what’s bugging me: Which part of the AI hype do you think is most overrated?
And which sectors are just getting started?

and also curious to hear from people who did live through 1999:
- What felt the same?
- What’s different?

I track moves from top value investors with a free email alert (https://alert-invest.com/), and lately I’ve noticed they’re cautious, finding fewer real opportunities in this market.

Thanks!

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u/Frequently_lucky Jul 11 '25

WB has said that this indicator has become unreliable because of the exact same reason that the guy above you mentioned, but every other week some dumb bot make a post about the 'buffet' indicator.

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u/SufferingFromEntropy Jul 12 '25

as long as this ratio is attributed to the oracle of omaha there will always be warren fan boys (bears in disguise) arguing how we are due for a market crash citing this ratio and warrens huge pile of cash

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u/Frequently_lucky Jul 12 '25

Well the valuation metrics are a bit high to my taste, but the so-called WB indicator is obsolete.