Germany's record-high stock market, in context

German stocks are at record highs, while their U.S. cousins remain short of such levels.

Why it matters: TSMINTE (the stock market is not the economy). German GDP was stagnant in the second quarter, showing zero growth rather than the 0.3% growth that economists had expected.

Between the lines: German stocks trade at more than a 40% discount to U.S. stocks in terms of price-to-earnings ratios, and they've underperformed the S&P 500 significantly over the past five years.

• As a result, compared with U.S. stocks they may actually look attractive, even when they're at record highs.
• Just don't take that as a vote of confidence in the sluggish German economy.