By Carl Capolingua
Publication Date: 2026-05-25 01:48:00
Every major market dislocation in the last 50 years has been accompanied by the same level of excitement and subsequent terror. The 1987 crash, the bursting of the dot-com bubble, the global financial crisis, the COVID crash all generated headlines declaring that the old rules of stock valuation no longer applied. Before each downturn, many claimed that old norms like the price-to-earnings (P/E) ratio – the standard measure of how expensive a stock is relative to its earnings – were redundant because “This time it’s different‘.
Regardless, there were inevitably highs in major global indices, but in each case only hindsight could confirm that the stocks were in fact overvalued. On the way up, there will still be just as many who believe that winning prevails revolutionary new economic engine justifies higher stock prices than those who condemn it.
10-year US Treasury yield chart, May 25, 2026. Source: TradingView
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