My favorite charts from Charlie Bilello's latest posts on stocks, bonds, and inflation
Longtime readers know I always look forward to the latest from Creative Planning's Charlie Bilello...
He puts together a weekly blog post with plenty of insightful charts. It's one of my favorite blogs, and I often include excerpts and charts from it in my daily e-mails.
Today, I'll highlight the most interesting charts from his past two posts – The State of the Markets from February 14 and The Week in Charts from two days ago – and wrap up with my outlook...
1) As of the State of the Markets post last week, 75% of the companies in the S&P 500 reported earnings and they continue to be strong – up 9.5% year over year:
The multiple that investors are putting on those earnings continue to rise. As Bilello also noted last week, it reached the highest valuation since June 2000... which was 48% above the historical median. Here's the relevant chart:
As a result, the S&P 500 Index continues to move up strongly. Take a look at this chart from Bilello's post last week:
As of yesterday's close, it's up about 23% over the past year. And it ended yesterday less than 1% from its all-time high.
2) It's not just stocks that are moving higher...
As the following table shows, as of last week, all 21 asset classes Bilello tracks were up this year (I've highlighted 2025 in red on the right):
3) While bonds are up slightly this year, they remain in a historic drawdown due to the huge surge in interest rates over the past four and a half years:
As Bilello put it last week, "at 54 months and counting, this is by far the longest drawdown in bond market history." Here's the table he shared:
Stocks have definitely been the place to be over the past three years – this chart from last week shows the huge difference versus bonds:
4) Inflation and inflation expectations are rising a bit, to be sure...
But I expect inflation to remain around 3% – above the Federal Reserve's official target and enough to keep the central bank from cutting interest rates much further (investors now expect only one 0.25% rate cut the rest of this year), but not enough to trigger a shift back to a tightening cycle.
Take a look at these next two charts from Bilello's post this week:
5) Believe it or not, I've only shared the highlights of Bilello's two latest posts. He also covers the rising U.S. government deficit, the housing market, commodities, international stocks, currencies, and cryptocurrencies.
I encourage you to check them out in full – again, you can see his State of the Markets post here and his Week in Charts post here.
Considering the big-picture situation, my overall views haven't changed...
The economy is strong, and inflation is under control. But market valuations are high... so it's not the best time to be buying stocks in general. That said, if you own good ones (or index funds), hang on to them – but have modest expectations going forward.
And of course, be on the lookout for the occasional gem that the market has overlooked or over-punished.
Meanwhile, cash – which is paying 4.3% to 4.4% in interest (as I've written many times, make sure you're earning this!) – is a perfectly respectable alternative...
Best regards,
Whitney
P.S. I welcome your feedback – send me an e-mail by clicking here.