The Stock Market Has Done This Just Twice in 156 Years. Now It's Happening Again.

The S&P 500's CAPE ratio has reached historically extreme levels (40.71), matching only two previous instances: the 1929 crash and the dot-com bubble. While today's AI-driven bull market is supported by profitable companies like Nvidia and Microsoft—unlike the speculative dot-com era—investors should prepare portfolios for potential downturns, as high valuations have historically preceded significant market corrections.