[Edaily Reporter KWON HYE-ME ] Warren Buffett, Chairman of Berkshire Hathaway, recently warned that the U.S. stock market is “becoming gambling rather than investing.”

According to the U.S. investment media outlet Motley Fool on the 5th (local time), Chairman Buffett made these remarks at this year’s Berkshire Hathaway Annual Shareholders’ Meeting, addressing the recent trend of excessive risk-taking in financial markets: “There has never been a time when people were so caught up in a gambling mentality as they are now.”

Buffett likened the stock market to a “church with a casino attached,” explaining, “Long-term value investing is the church, while short-term speculation for quick profits is the casino.”

He continued, “Casinos have become far too attractive to people. What we’re seeing now is gambling—neither investment nor speculation,” pointing out that “many assets are priced far above their actual value.”

However, the examples Buffett cited included ultra-short-term derivatives trading and zero-day-to-expiration (0DTE) options.

In fact, key valuation metrics are also indicating market overheating. The “Buffett Indicator”—the ratio of a country’s total stock market market capitalization to its gross domestic product (GDP)—has soared to 232%, reaching an all-time high.

A high Buffett Indicator suggests that the stock market’s value is disproportionately large relative to the actual size of the economy (GDP).

The Shiller CAPE (Cyclically Adjusted Price-to-Earnings ratio)—a key indicator of whether the U.S. stock market is overvalued—has also remained above 40 since last May. The only previous instance in which it consistently exceeded 40 was just before the dot-com bubble in 2000.

However, Motley Fool explained, “We cannot conclude that signs of overheating will immediately lead to a major downturn,” adding, “A strategy of holding companies with fair value and solid fundamentals for the long term is more important than short-term price fluctuations.”

Meanwhile, in an interview with CNBC’s Becky Quick last July, Chairman Buffett emphasized, “It’s difficult to find valuable investment opportunities when everyone is focused on speculation,” adding, “Truly meaningful investment opportunities are rare, and one must approach them with patience and principle.”