Wall Street Bull Ed Yardeni Cautious on AI, Bullish on the 'Roaring 2020s'

ME News reports that on August 26 (UTC+8), Ed Yardeni, president of Yardeni Research and a long-standing Wall Street bull, remains highly optimistic, having raised his S&P 500 year-end target three times this year—from 7,700 to 8,250, and now to 8,400. He notes that the dot-com bubble of that era was primarily driven by “fear of missing out” (FOMO), pushing the S&P 500’s forward P/E ratio to as high as 25x, with technology sectors reaching around 55x. Today, the market is being fueled by “fantastic earnings momentum” (FEMO). As earnings expectations continue to rise, market valuation multiples have actually declined; currently, the semiconductor sector trades at around 17x P/E and the broader market at approximately 20x—significantly below levels seen during the 1999 bubble. Ed Yardeni states that as long as the U.S. economy avoids a recession, there is still an approximately 80% probability that the “roaring 2020s” will continue. Even in the event of geopolitical shocks, historical market pullbacks have often presented opportunities to re-enter. Regarding the AI rally, Ed Yardeni takes a more cautious stance. He believes the market is experiencing “AI fatigue,” making it difficult to identify final winners and losers; thus, he advises against investors chasing individual AI stocks. For those seeking exposure to the AI theme, a more suitable approach is through diversified investments such as Nasdaq-100 index funds. (Source: ODAILY)