Protecting Your Portfolio in a Bubble, and Is a Move to America Worth the Money?

In 1999, the cyclically adjusted price-to-earnings (CAPE) ratio hit its highest point in 145 years. Right now, it sits at 41—the second-highest reading on record, against a long-run average of 17. Scott Galloway offers that number not as a prediction but as a warning label: the market is historically expensive, and no one knows when the correction will come. The episode takes up that uncertainty alongside three other listener questions about life-changing decisions—whether to move from Sweden to the U.S., how to be a better manager, and how to sell a small company at a premium—each of which Galloway treats as a problem of tradeoffs, leverage, and honest self-assessment.

Diversify, Don't Exit

The first listener, who has done "all the right things" with his investments, asks how to stay calm when the American economy feels like a ticking time bomb. Galloway's answer is blunt: trying to time the market is a mistake he made himself. After the 2016 election, he sold all his stocks out of political disgust, paid a third of the gains in taxes, and bought back in six months later at a market that was 10 to 20 percent more expensive. "That was stupid," he says. The lesson is not that overvaluation doesn't matter—it clearly does—but that the CAPE ratio is a poor timing signal. When it is high, it can go much higher.