The US markets are all back at all-time highs.
I am happy because it feels really good and even right. In a market like this I remain underinvested but am being dragged into positions by the positive price action.
Here’s what I see:
Apple is being rewarded from profits and execution (I have been selling a bit lately).
Google is ‘chopped suey’ because Google Glass and Google Plus were a waste and they are in fights with their creators on YouTube and possibly Uber which they have invested in. Maybe Uber will go with Apple Maps for a giant kick in the Google nuts. I want to buy more Google but it’s not hated quite enough and not in a clear win zone.
Facebook is working because nobody has to listen to Zuckerberg and be annoyed. He’s quiet.
Twitter bought some time and the stock was too hated at $36, but seems way pricey at $48 (long but on the fence).
Oil is way too cheap but a bunch of lunatics around the world have always been in charge so screw them all. Enjoy the cheap prices I guess.
Biotech keeps working. It’s been the perfect storm of liquidity, strong IPO market, and genomics mixed with cheap computing and big data. The FDA scares me but nobody else.
Walmart just offered their own version of ‘Quantitative Easing’ by giving their slaves a pay raise.
McDonald’s is being left for dead in the ‘burger bubble’ (Shake Shak, Five Guys, Gourmet Burgers, In ‘n’ Out).
Netflix is humming and it helps that cable companies are as clueless as ever. This last week I have been massively entertained as I take some time off by ‘The Honorable Woman’ , ‘The Fall’ and now ‘The Killing’. Addictive binge stuff and fantastic shows. I need to cut the chord but Time Warner supplies my internet on Coronado.
We are at ‘Peak Economist’ on Twitter. There are no good living economists. Markets are too global and complicated. No economist looks outside anymore. They read blogs and spreadsheets and pontificate on Twitter. Meanwhile, Brooklyn is more important economically than Greece and Russia will never change.
With all that said we have a boom that has raged a long time from 2008 lows along with zero percent and negative interest rates that have helped the rich get richer and the pigs stuff their coffers with cash. The ‘unicorns’ are hoarding cash. The old fat cash cows are paying their fines and laying off as many people as possible. They are also upgrading technology which just puts fuel on the trends you already have witnessed since 2008’s bottom.
The middle class and new investors (millenials) are scared of individual stocks and based on CNBC ratings think Cramer and business television is horrible. They are being ETF’d like crazy. Most of this is for good reason.
But they do read Buzzfeed and see Pinterest at $11 billion, Snapchat at $20 billion and Uber at $42 billion. The middle class and millenials use these products, drink coffee at Starbucks and line up for Nike sneakers (all-time highs as well).
That leaves us at this inflection point where the ‘Fear of Missing Out’ (FOMO) is bashing up against the ‘Fear ff Holding the Bag’ (FOHB).
It feels like the fear of missing out is winning for the time being. I am not going to fight this trend. Keep an eye though as these cap tables and valuations are not as they appear and aided by some incredible monetary tailwinds.