in 2001. The famed investor and Berkshire Hathaway CEO called it"probably the best single measure of where valuations stand at any given moment."
The billionaire noted the indicator skyrocketed during the dot-com bubble, and said that should have been a"very strong warning signal" of an impending disaster. He added that buying stocks when the gauge reads 70% or 80% would likely pay off, but doing so when the ratio approaches 200% would be"playing with fire."
The global stock market has a way to go before reaching that level, but the Buffett indicator for the US alone currently reads 159%, a Markets Insider analysis shows. It has soared largely due to the S&P 500 and Nasdaq Composite gaining 13% and 29% respectively this year — but still remains