Have We Hit The Top?

[Gregmal]

This really isn’t an issue for most companies. It’s only really related to investment managers and such, and those certainly don’t trade at a market multiple.

[Cigarbutt]

14 hours ago, blakehampton said:

I was reading BRK shareholder letters when I had a thought:

Since unrealized investment gains are now included in net income, wouldn’t that mean that the S&P 500’s EPS is overstated? Buffett has repeatedly explained since 2017 how Berkshire’s reported net income isn’t actually representative of its earnings. In a rising market, wouldn’t this then have the same effect with the S&P? It’s sort of hard to wrap my head around but I feel like appreciation in stocks generally would then show up in the earnings of companies.

 

Edit: The change was ASU 2016-01

Interesting.

In Japan (see below), during a certain period, there was a growing trend (increasing corporate cross-holdings in a rising market):

For the US, this time is different because the level of corporate cross-holdings is low. In your great country, the trend is for the rising market to be held by the top 1% and "foreigners".