There are many different ways to measure how "cheap" or "expensive" the U.S. stock market is. One of those ways is by comparing the total market cap of all U.S. stocks to U.S. GDP. This ratio has been called the Buffet Indicator after Warren Buffet famously said that it was "probably the best single measure of where valuations stand at any given moment."
This article from Guru Focus explains a bit about the Buffet Indicator and then uses the ratio to estimate forward-looking, annualized market returns across 26 developed and emerging markets. In our view, the key takeaway is this: today, developed markets are expensive relative to their emerging market peers. As value investors, we seek undervalued and out of favor holdings. Therefore, now may be a good time to look to emerging markets for value opportunities.