A camel’s back waiting for a straw

This update is brought to you by Occam’s razor.

• A myriad of market valuation metrics all point to a +95 percentile ranking in valuation metrics versus their long-term rankings. The probability skew, therefore, of risks lies significantly to the downside rather than the upside.
  • Valuations, of course, are not timing signals until you realise they were the ones shouting loudly for your safety.
• Credit spreads (corporate risk premium over government interest rates) are at the lowest levels since May 2007 and before that, July 1997. All while bankruptcy filings in 2025 race towards 2009 levels.