Is the Chinese Stock Market Still Overvalued?

A little less than a month ago I posted that China’s stock market was overvalued.  In the two and a half weeks after my post, the Shanghai Composite gained another eight percent.  Do I feel foolish?  Nope.  That market is now down three percent from the day I posted (which is 10 percent from its peak.)

Don’t get excited by my apparent prescience.  On a short-term basis, predicting stock prices is like rolling the dice.  Over the long haul, though, I feel a lot more comfortable saying that highly valued things eventually come down.