Buffett Indicator hits a new all-time high, indicating that the US stock market is at a relatively high valuation level

On January 11, according to Barchart, the Buffett Indicator (the ratio of total US stock market capitalization to GDP) is approximately 223%–224%, with some data sources even showing around 230%. This is the highest level in history, surpassing the peak of the 2000 internet bubble (about 150%) and the high point after the 2021 pandemic. Historically, the long-term average of this indicator has been around 80%–100% (since 1970), with 100%–120% considered a relatively normal “reasonable valuation” range. The Buffett Indicator is one of Warren Buffett’s most valued overall market valuation metrics, and he has called it “the single best indicator of market valuation.”