S&P 500 is about 30% overvalued. It’s either going to head back down to 875-ish, or there won’t be much return over the next 5-7 years. Either way, the S&P is a very bad bet from current levels. But it was a good long-term bet under 700.

Great graph at this link:

http://dshort.com/charts/SP-Composite-regression-charts.html?SP-Composite-real-regression-to-trend

What’s amazing to me is how long some of these periods of over- and under-valuation last.