I do find it funny to see how many rely on the words of central banks to determine whether markets are or are not in bubble territory. Central banks these days are in the business of mind manipulation for the furtherance of asset price stability and economic survival and to expect them to malign the object of their obvious intent would be insanity. Central banks are supporting asset prices for balance sheet purposes and to suggest these prices were in bubble territory would be counterintuitive.
While I do feel that central banks should be mindful of bubbles and look to circumvent asset focussed money supply growth, the ability to do so in the current context may be long since gone – possible the last time there was such an opportunity was in the early 2000s and most certainly around 1997/1998.
As such, it is up to investors and market participants to decide whether or not asset prices are in a bubble.
As I have said before, and I will say it again: a bubble is where the current present value of an asset is inflated to an extent where discount rates are generous in terms of the ability of an economy to generate the necessary growth in output to justify those discount rates. In order to get rid of a bubble you raise your expected returns and in order to identify a bubble you may need to lower them. I feel that the central bank definition of a bubble is one where there is no rationale for an emphasized allocation to an asset or market and hence where there is no model that could justify it. I think this is clearly wrong but it is one that suits the imperative and the mood that underpins its greater certainty.