Is the value of everything really too high?

To some, the recent sell-off in global financial markets was merely the beginning of what will soon become a much bigger downturn, because the valuations of many assets remain excessively high. However, our view is that valuations are generally not very stretched, even that of China’s stock market following its tumble. Indeed, in some cases, the valuations of assets are now unusually low. Needless to say, this does not preclude further falls in their prices, but it may cushion the downside.