The Buffett Indicator

US Total Stock Market Cap divided by US GDP. Warren Buffett called it “probably the best single measure of where valuations stand at any given moment.”

Current value

234%

Globalization-adjusted: 116%

Strongly Overvalued

US Market Cap

$74.5 T

US GDP (annualized)

$31.9 T

Ratio

233.9%

Historical Chart

Denominator

Classic Buffett Indicator — US market cap ÷ US GDP. Biased upward over time because US firms earn ~40% of revenue overseas.

S&P 500 foreign-revenue share

20.0% (1970)→41.0% (2026)

Interpolated between annual S&P Global / FactSet anchors

Buffett Indicator (GDP)

Historical bubble peaks · pre-1971

Annual estimates · not in continuous series

1929

~87%

Pre-Crash peak (NYSE-listed mkt cap ÷ GDP)

1937

~67%

Late-recovery peak before 1937–38 recession

1968

~81%

Nifty-Fifty / late-60s peak

Continuous market-cap data (Wilshire 5000) only begins in 1971. Pre-1971 values are annual back-calculations from Z.1 Financial Accounts (1945+) and academic reconstructions of NYSE market value (1929, 1937) divided by BEA annual GDP. Treat as directional, not point estimates.

What it means

When the indicator climbs well above 100%, the stock market is large relative to the underlying economy — historically a sign of stretched valuations. When it falls below the long-term trend, equities have tended to deliver stronger forward returns.

Zones

Strongly Undervalued< 75%
Undervalued75 – 90%
Fair Value90 – 115%
Overvalued115 – 135%
Strongly Overvalued> 135%