1/ Thread. US markets are still extremely expensive relative to history. Growth stocks specifically. Value is at bargain levels. Ex-US stocks are between fairly priced & cheap. Commodities are at generational lows. This RIA chart gives a clear view of the S&P500 price bubble.

2/ Looking not just at after-tax profit multiples, but other traditional value metrics too (as per this Tomasz Hondo graphic), it's apparent that the S&P500 is almost as expensive as it was during the very height of the 1999/2000 era.

3/ This overvaluation is driven mainly by tech/growth stocks which are currently trading at levels in line with the final few months of the Dotcom boom. This post from Jeff Weniger shows just how highly priced the current euphoria is.

4/ This is backed up by a recent graph from Modest Proposal showing how the 75 quickest growing, large cap stocks are currently selling for a more expensive earnings multiple than the peak of the 2000 bull market (and at their highest level in at least 70 years).

5/ Using Tobin's Q ratio we can see that based on the S&P500's cost of replacement, the market is now almost more overvalued than it has been at any other point in the past 120 years. This figure from Tiho Brkan shows the scale of the excess.

6/ A recent chart from Christophe Barraud detailing the fear/greed readings for the NASDAQ also shows how desperate tech/growth investors are right now. Even the absolute pinnacle of the first internet boom is no match, when compared to today's risk-on growth sentiment.

7/ Today's market overvaluation is further corroborated by analyzing total market cap to GDP data (aka the Buffett Indicator). It has recently spiked up to 177%. An alarming level and far, far above the climax of the Dotcom years.

8/ The average investor also has a full allocation to equities. The only time US investors had a higher allocation in the past 70 years, as a percent of their total wealth, was in the very last year of the spectacular 90's bull market. The graphic comes from Jesse Livermore.

9/ Growth hasn't just outperformed everything else in the US to a staggering degree. It's done the same worldwide. Over the last decade plus, growth has gone on its largest global run in more than 50 years. No wonder compounder owners these days make crackheads sound sane.

10/ Meanwhile, some fascinating work from Mikhail Samonov shows how value stocks haven't had this large a drawdown in almost 200 years. His excellent discussion with Tobias Carlisle, accessible on YouTube, details the research methodology employed.

11/ Looking outside of the US (per StarCapital), we can see EM equities are clearly cheap in historical terms (almost at a post-GFC level) and that European stocks are not quite as cheap but still attractive if you measure them against their 40-year average.

12/ The EM equity conclusion is supported by an image from Raoul Pal showing how emerging market stocks are now closing in on their cheapest level versus the S&P500 in almost 50 years.

13/ Commodities are an even bigger bargain than emerging market stocks currently. There's evidence showing they may well be at their cheapest point in over 200 years.

14/ At the very least it seems they're somewhere near 100-year lows. In other words, buying EM commodity-driven stocks using a value framework is the smart margin-of-safety investment for now and will likely deliver decent returns over the next decade.

15/ Given the above, it's hard to argue US markets & especially tech stocks aren't grossly overvalued. An additional issue is that some key data suggests the world faces its biggest economic crisis in 70+ years. The World Bank notes global GDP hasn't fallen this hard since 1945.

16/ Not at any time in the past 150 years have there been this many countries around the planet simultaneously in recession. The data again comes from the World Bank.

17/ Public debt levels across both DMs & EMs haven't been this elevated since the late 1800s. Even going into the Depression, WWII, & the GFC, debt-to-GDP levels weren't nearly as bad. So the idea of a fast, full global GDP recovery seems either optimistic, naive, or both.

18/ In the US, there are some major issues that need fixing before GDP growth can likely fire on all cylinders. The jobless numbers are the worst since the Depression. Even if the 10% White House target is hit by 2021, it'll still basically be the worst job market since the 30s.

19/ US corporate indebtedness is rocketing upwards and hasn't been this bad in at least 70 years.

20/ Related to this, the number of US zombie corporations - that can't afford to service the interest on their debt - is closing in on 20% of the total and rising. This while borrowing rates are at record lows.

21/ The US is too bifurcated. The Economist notes FAAMG stocks make up 13% of S&P500 profits but less than 5% of S&P500 jobs. FAAMGs share of S&P500 profits is forecast to be about 20% by 2025. This is true too for US income disparity, where the top 10%'s share is at 1929 levels.

22/ The share of wealth going to the ultra rich is also at 1929 levels. Just as FAAMG & other major tech businesses are quickly hoovering up an ever-growing percentage of US corporate profits, so wealthy Americans & the super rich are doing the same with personal wealth.

23/ Meanwhile, minimum wage has gone nowhere in the US for the past half century even though worker productivity has increased dramatically. A fair economic share simply has not been passed on to the average US worker, given what they've delivered.

24/ This is at least partly why US home prices for the average worker are now more unaffordable than at any other time in the past 60 years, except for the very peak of the epic 2006/2007 property bubble.

25/ It also shows how the S&P500 can have margins at 60 year highs. If capital has all the power & labor very little, it's no surprise wages remain low & workers get the bare minimum. History shows us however, that major economic disparities tend to mean revert.

26/ To sum up: The US might be in its worst spot since the 30s. Unemployment, debt, & inequality, mean a fast recovery is unlikely. A tough comeback with civil unrest seems more probable. The US may need a new New Deal. Until then, truly broad economic growth looks out of reach.

27/ Market-wise, most US stocks (especially growth ones) are extremely overpriced. Deep value is cheap, even in the US. The surest bet for the next decade seems to be commodity-driven stocks in emerging markets. That's where the largest margin of safety is currently found.