Image Source: Pixabay

As we noted yesterday, stocks are bubbling up.

The meme stock craze of 2021 is back with unprofitable, financially unstable companies soaring in value. First it was Opendoor Technologies (OPEN). But now Krispy Kreme (DNUT), Kohl’s (KSS) and GoPro (GPRO) are joining in.  These stocks are all up near triple digits this week on massive short-squeezes.

Moreover, the overall indices are getting VERY richly valued. The S&P 500 has a P/E of 30, which is nearly TWO TIMES the average P/E of 16. The only time the index has sported a higher P/E was during the Tech Bubble, the bottom of the Great Financial Crisis (because profits evaporated) and during the Pandemic Bubble (ditto).

(Click on image to enlarge)

Meme mania back with excessive speculation? Check.

Stock market extremely overvalued? Check.

Yep, this is a bubble.

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