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Developed Market Stocks & Bonds Have Never (Ever) Been This Expensive

Thanks to the new normal world of extremely loose monetary policy and extraordinary accumulations of financial assets by Central Banks, Deutsche Bank finds that we live in a period not of selectively expensive global asset prices, but of record "expensiveness" across developed market bonds, stocks, and real estate.

In aggregate, across the three main asset classes, average valuations are close to the highest they’ve ever been relative to their long-term trend. The current reading of just under 80% is similar to that seen at the turn of the twentieth century and during the 1940s when financial markets were artificially repressed around war time.

And, based on Deutsche's valuation metrics, bonds and equities alone are at their highest ever combined valuations when aggregated across these 15 countries.


In addition, 83% of observations are in their top 20% of valuations through history.


Peak Asset Prices?

Source: Deutsche Bank