This should be the best of times for investors, right?
- Stocks are at all-time highs.
- Interest rates are at all-time lows.
- And with most of the country vaccinated, now we can get back to business.
But this isn’t the best of times at all. It’s just the calm before the storm.
Consider this a warning. Your nest egg and retirement are at risk.
And today I’ll explain why.
A Weary Bull
To set the stage here, let’s be clear:
We’re currently in the longest-running bull market in history.
I know you don’t want to hear this, but these runs don’t last forever.
History repeats itself. So a market crash is inevitable. It’s just a question of when.
To see what I mean, look at the “Buffett Indicator”…
The Single-Best Measure
There’s a good reason Warren Buffett has been able to amass a $100.8 billion fortune:
He’s been able to predict when stocks are undervalued…
And when they’re overvalued and poised for a crash.
For decades, he’s relied on a specific indicator to determine valuations and make major market decisions. It’s the so-called “Buffett Indicator.”
Simply put, this indicator measures the total value of the U.S. stock market vs GDP.
In a Fortune Magazine interview, Buffett said it’s “probably the best single measure of where valuations stand at any given moment.”
It’s hard to argue with him. After all, it’s successfully predicted every crash in recent history, including the dot-com crash in 2000, and the crash of 2008.
The way it works is simple: once this indicator crosses a certain threshold, the market is set to crash. Where does it stand right now? Let me show you…
The Current Situation
This chart, courtesy of CurrentMarketValuation.com, clearly shows the situation:
As you can see, as of last week, the Buffett Indicator was flashing red — with a terrifying value of 241%.
That’s about DOUBLE the value of the long-term trend.
That’s why so many experts are predicting a crash — including, as Business Insider reported yesterday, Morgan Stanley’s Chief U.S. Equity Strategist.
Many predict the coming crash could be worse than 2008. And some experts are forecasting it could be worse than The Great Depression.
This could mean disaster for your portfolio. Based on the Buffett Indicator, you could see 50% of your nest-egg get wiped out in a flash.
Meaning, even if you’ve worked hard, saved your money, and invested it wisely, you could still be forced to delay — or worse yet, cancel — your retirement plans.
Are You Prepared?
Maybe you think if you have enough money saved, or enough time before you retire, that you'll be fine.
I hope you’re right.
But I have to warn you. There’s a simple reason that might not be the case at all. And most investors aren’t aware of it.
So tomorrow, Wayne will explain what it is.
For the sake of your retirement, please stay tuned.