Good morning. A closely watched valuation gauge championed by Warren Buffett is signaling potential trouble in today’s market.
In a new Fortune article, my colleague Shawn Tully discusses the metric—the Buffett Indicator. It is the ratio of total U.S. stock market capitalization to GDP. It has become one of the most closely watched valuation gauges on Wall Street since Buffett explained its logic in a landmark 2001 Fortune article, according to Tully. Buffett was writing at a time when the dot-com bubble was deflating. The premise is straightforward: when the ratio climbs too high, stocks are expensive relative to the underlying economy; when it falls, opportunity often follows.
Buffett laid out the stakes plainly in that original piece: “If the relationship [between the total value of equities and GDP] drops to 70% or 80%, buying stocks is likely to work out very well for you,” he wrote. “If it approaches 200% as it did in 1999 and 2000, you are playing with fire.” By the time the article was published, the S&P 500 had already dropped more than 20%. It would eventually retreat nearly 50% from its peak before the indicator fell back below 80%, setting up one of the great buying opportunities of the era.
“The concepts Buffett presented a quarter-century ago are timeless, and they’re especially relevant today because the yardstick he tagged as pointing to danger then looks even more ominous now,” Tully writes.
The question now is where the indicator stands—and what it signals for CFOs managing corporate treasury and investment decisions in a volatile macro environment.
Tully’s analysis breaks down the current reading, how the metric has evolved since Buffett first introduced it, and why it still matters—even as Buffett himself has grown more cautious about endorsing any single measure as definitive. Read the full article here.
Sheryl Estrada
sheryl.estrada@fortune.com
Leaderboard
Matthew Gall was appointed CFO of Tango Therapeutics, Inc. (Nasdaq: TNGX), a clinical-stage biotechnology company. Gall succeeds Daniella Beckman. He is a seasoned biotechnology executive. Previously, Gall was CFO at Kalaris Therapeutics and iTeos Therapeutics, and held finance, business development and corporate strategy roles at Sarepta Therapeutics, Celgene Corporation and Gilead Sciences.
Craig Segor will step down as EVP and CFO of Aviation Capital Group (ACG), effective May 31. Segor joined ACG in 2022. The company has started the process of identifying a successor.
Big Deal
KPMG's Q1 2026 AI Pulse Survey finds that 94% of banking leaders say AI will remain a top investment priority even if a recession occurs in the next 12 months, up from 80% in Q4 2025. Banking leaders project average AI investment of $177 million over the next 12 months, a 33% increase from the prior quarter.
On AI budget allocations, 80% of respondents cited cybersecurity or data security as a priority, followed by operations and customer service at 75% each. Nearly half (47%) of banking respondents say they have already deployed AI agents.
Workforce implications are also emerging: 54% of banking leaders said they are willing to pay 11-15% more for strong AI skills, up 18 percentage points from 36% in Q4 2025. Another 73% expect humans to primarily manage and direct AI agents over the next two to three years.
"AI implementation in banking won't be won by speed alone," said Peter Torrente, KPMG U.S. sector leader of banking and capital markets. "As investment and deployment accelerate, the institutions getting it right are upskilling their workforce while embedding governance early — so shortcuts don't undermine scale or introduce systemic risk."
The AI survey is an extension of the firm's quarterly pulse report, based on responses from 101 U.S. banking leaders.
Going deeper
The Q1 2026 Monster Market Report analyzes the top 10 job titles posted by employers, the most searched job titles by candidates, hiring trends across major occupational groups, and the fastest-growing city-level job markets.
Overheard
"This is fresh to the day, to the hour, to the minute."
—Carl Hansen, vice president of government relations at Coco Robotics, told Fortune in an interview. The Los Angeles-based startup operates roughly 10,000 delivery bots across the U.S. and Europe that produce real-time data. Hansen said the robots rolling down sidewalks collect data that generates a sidewalk map updated to the minute. The company has found that even cities with existing sidewalk data are working off stale information.
