Are U.S. Company Valuations over the Last 25 Years Justified?

Personally no. I remain sceptical about imputed p2e on almost all non tangible deliverables, ad revenue aside. Inflated licence costs and accounting tricks and brand power appear to a shitload of value carried into being. But, some companies (apple) are sitting on a lot of money, and their value proposition has grounding in real goods and a walled garden.

Others, (tesla) are precarious despite a rocket ride of share price and others (spacex) are changing a landscape in a specific, high cost area.

China operates in a different model. It has different cost of capital, labour, compliance. It also has a giant domestic market, 3x the scale of the US, and had three decades or more of enforced savings. The scale of suppressed spending demand in that place cannot be understated across this time.

India is more interesting in some ways because it's forcing its middle class out into the world and also growing its domestic economy, but without the Chinese state planning drives.

I think the next 50 years belongs to Asia. Europe will have to rethink itself, in a demographic decline, but resistance to growing its missing labour force from the obvious places in the Middle East and Africa. Latam economies seem stuck in the Sargasso sea of boom-bust.

I don't see how the US comes back from removing the underpinnings of the post Bretton Woods world of mutual trust.

I should point out a senior citizen friend invested in every stock I decried on moral and financial grounds and made bank on his stake over 18 months including crypto ETFs (God...) and I meanwhile depend on fund managers to plot my slow and steady pathway to the natural 7% longterm return. So, there's that: people who ignore me do significantly better in the short term.

>over the past 25 years are justified?

There have been periods of extreme excess (DotCom bust, the end of the ZIRP era), but overall I find it hard to argue that there hasn't been value creation for investors.

>China

Investing in China is a different paradigm than investing in US companies. By and large, Chinese companies do not put returning capital to shareholders as the top priority, and they are also restrained by government priorities (and it's not smart to violate the red lines - both the explicit and implicit red lines - see the tech crackdown a few years back).

This also goes for one of the most important elements for VC, which is cashing out. Remember DIDI and their clawed back IPO? In those cases the investors don't just lose their money, the people who violated the principles may be taken in for re-education and get blackballed from business entirely.

That said, the mainland Chinese equity/IPO space has gotten much more developed recently, and the government has even prioritized promoting things like the STAR (tech) exchange. This should theoretically make pushing startups to IPO have less friction, and I'd expect Chinese VC to continue to develop amidst this backdrop (and sure, valuations could rise with it). At the end of the day the Chinese startup scene doesn't have the trillion dollar right tail like the US does though. Returns are a bit capped, because anything of critical importance is going to be at least partially guided by the state instead of in the US, where by and large it's entirely about shareholders.

> considering they operate at a fraction of the cost compared to U.S. companies?

Data?