The "Priced In" Chart Isn't Pretty

A long-term trend analysis suggests that we're heading to more challenging times than what they're suggesting out there in media land. Be vigilant.

Dear Reader:

Somewhere in CNBC land, perma-bulls suggest that the tariff news and the ongoing weakness of this environment are priced in. 

“Priced in!!!” - they claim. Here’s the headline from Wednesday…

The definition of priced in:

“When a stock's price already reflects expected future events or data, it's said to be 'priced in'. This signifies the market's anticipation of outcomes.”

However, that term has lost a lot of meaning with me in recent years.

A month ago, before this selloff started, Fidelity's Jurrien Timmer joined CNBC to say that the stock market isn’t “mispriced in terms of valuation.”

The argument went that the U.S. had the strongest fundamentals.

And that the bull market thesis was still intact.

Equities weren’t “mispriced,” he said.

Well, a month later, money is rushing abroad.

The Shiller PE Ratio has dropped from the third highest peak on record at 38.

The market doesn’t seem to have agreed with Mr. Timmer.