Jarrow and co find a better way to spot stock market bubbles

As analysts warn about euphoria in US markets and the Cape ratio – economist Robert Shiller’s widely watched metric of stock market frothiness – nears all-time highs, investors could do with a reliable way to detect and measure asset bubbles.

As a matter of course, buy-siders weigh prices against model-derived reference points of fundamental value. But their reliance on historic data can leave