Dave Ramsey Explains Why Stock Market is 'Never Overpriced' Over Long Term – 'It's Not A Casino'

6 days ago 10

Fahad Saleem

Sun, December 14, 2025 astatine 8:30 AM CST 3 min read

The soaring valuations of tech stocks and the ongoing statement implicit a imaginable AI bubble person sparked questions astir whether these marketplace prices are backed by fundamentals oregon if investors are simply gambling connected speculation. However, idiosyncratic concern adept Dave Ramsey believes banal valuations are mostly not irrational implicit the agelong term, but during a fewer utmost marketplace events.

A caller asked Ramsey connected "The Ramsey Show" whether helium should enactment his wealth into existent property due to the fact that helium felt there's a disconnect betwixt banal prices and their earnings. Ramsey rejected the thought that banal valuations are artificially precocious and said stocks are usually supported by fundamentals, but during uncommon and little periods of hype oregon utmost undervaluation.

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"By and ample the banal marketplace wide is ne'er overpriced implicit the scope of time" Ramsey said. "There whitethorn beryllium a infinitesimal successful clip that it is oregon determination whitethorn beryllium a infinitesimal successful clip that it’s nether priced."

The caller reiterated his interest that the banal marketplace looks similar a "giant casino" to him due to the fact that of seemingly "artificial" banal valuations. In response, Ramsey said the banal marketplace cannot beryllium called a casino due to the fact that investors tin usage fiscal metrics to analyse a banal and foretell its aboriginal trajectory.

"You're betting that Apple, McDonald’s, Coca-Cola, Home Depot are going to beryllium worthy much 5 years from present than they are contiguous and wherefore would you marque that bet?" Ramsey said. "Well, you would look astatine their way grounds of growth, the banal terms maturation and you would look astatine the absorption squad and you look astatine the nett margins and you would besides benignant of task successful the aboriginal what you deliberation the concern clime is that they’re going to beryllium in. So it’s not a casino, casino is genuinely a crippled of chance."

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However, Ramsey acknowledged determination person been a fewer periods successful past erstwhile banal prices became sharply disconnected from their underlying value. He pointed to the dot-com bubble and the illness of Exxon Mobil Corp. (NYSE:XOM) banal terms successful 2020 erstwhile lipid prices concisely turned antagonistic amid deficiency of demand.