Absolutely. Here's a recent quote from John Hussman that really changed my perspective: > "There's this notion that low interest rates justify high valuations.

Absolutely. Here's a recent quote from John Hussman that really changed my perspective: > "There's this notion that low interest rates justify high valuations. You have to understand what people are saying there. So let's say that I've got a security that is going to pay $100 a decade from now. And I want to get, let's say, a 6% annual return. I can say well, for that return, I would pay $55.80 for that. > Now if I'm willing to get a return of only 2% annually, I'll be willing to pay more than $55.80; I'll be willing to pay $82. If I'm willing to get a zero return, I'll be willing to pay $100 for that security today. If I'm willing to accept a negative return, I'll pay a price over $100. That's the way valuations work. The higher the rate of return you're going to bargain for, the lower the price you have to pay. > So when people say low interest rates justify higher prices, what they're really saying is that low interest rates justify low returns on stocks. > So to say that interest rates are at record lows, therefore these record high valuations are OK, is identical to saying that interest rates are at record lows therefore the expected returns on stocks should also be at record lows. > But that's not what people actually are thinking. They're thinking, no, justify means I'm going to be OK, that I'm going to earn normal returns. Oh no you're not."