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Still Pending
US equities meandered through another mostly meaningless session Tuesday.
Traders were stuck in sus
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Markets now remind me of “Chronicle of a Death Foretold”: we all know that worsening liquidity and the appropriate reckoning is coming.
I know this sounds naive but the multiples carried by the big high growth tech stocks have had little basis in reality for some time. Considering Meta in context makes me shake my head. They claim a customer list of just under 2 bil people, a quarter of the planet. To think that the company will continue to grow at its historical rate much longer is sheer folly. It’s money comes primarily from targeted advertising. How much can that revenue source keep growing in the third world? As to virtual reality, the prospects for that option across the firm’s base seems even less realistic. At some point this company and many like it in the social space will soon get slammed with the reality of slowing or, as in the case of Peloton, negative growth. Other record losses will occur as results start to miss unrealistically lofty targets. I can’t help seeing these guys as pals of Wily Coyote running off a cliff, feet in the air, going a mile a minute, trying to hit the ground that’s no longer there.
BTW, I just saw Morgan Stanley’s ad in WSJ congratulating its roughly 200 new managing directors. Seriously? Too much wasted money out there. Feed the poor and homeless instead.