As we've previously written, we are less optimistic about the market's potential returns from current levels for the next few years. While many valuation indicators point to a richly valued market, the economy is showing signs of weakening.
It is not that we are overly concerned about the economy, but mostly that we think current valuations are priced for robust economic performance - and once it becomes clear to investors that the best they can expect for the next couple of years is 1-2% GDP growth, multiples could come down considerably.
One telling indicator