S&P 500 is ‘bizarrely overvalued’ and could crash 49% as recession sets in, elite strategist says

Paul Dietrich, Chief Investment Strategist at B. Riley Wealth Management, is warning of an impending stock market crash, suggesting the S&P 500 could plummet to its lowest level since the pandemic crash. He compares the current buying frenzy to the rush for lottery tickets when the jackpot is exceptionally high, indicating a speculative bubble. Dietrich advises against investing in stocks now, citing various valuation metrics and indicators showing stocks are overvalued.
Dietrich points to the historically high price-to-earnings ratio, low dividend yield, and unrealistic earnings growth expectations as signs of an overheated market. Dietrich also notes Warren Buffett’s record cash holdings, increased corporate cash piles, and rising inflows into money-market funds as signs of market concern. He predicts a mild recession and a potential 49% drop in the S&P 500. Despite positive economic indicators, Dietrich remains convinced that a crash is imminent.