I was asked for my view on the current “market” reactions to both Netflix™ in particular, and what is now referred to as “FAANG.” i.e., The grouping of Facebook™, Apple™, Amazon™, Netflix, and Google™ aka Alphabet™. Here’s my reply:
Rather than trying to answer your question with words, for it would take more digital ink than I have at the moment. Let me make a case using what is known in Silicon Valley as a “picture” aka chart and let you decide. Because after all, it’s not what I think that matters rather, it’s what it all means too you. So here’s where you need to decide for yourself. To wit:
The above charts are of two entirely different entities, and yet, there’s something very similar in appearance, don’t you agree? But here’s a very simple description that separates the two:
On the left is what is now referred to as “one of the greatest bubbles in human history.” The other, on the rights’ story is, “One the greatest investments and companies of our lifetime.” However, they do have one thing in common – they both represent “investing” during the glory period of central bank intervention. Can you guess who they are?
Here’s a hint, again to wit:
The left is Bitcoin™, on the right is Amazon. The only difference between the two (excluding the timeline) is that Amazon’s height is as of this writing. So, with that said, if the past can be prologue, let’s see how that whole “unstoppable” Bitcoin bubble went once the so-called “thrill was gone,” shall we?
Here’s another “picture” to remember it by. But I caution you, it may bring back some very painful memories, so again, to wit:
As I said, what it all means is entirely up to the way one wants to interpret the above, for it’s all a matter of ones own perspective, or wallet.
However, if I may say one thing, I will say this:
I remember vividly just how vehemently the idea that “Bitcoin” was no way in any form of bubble also, to bolster that claim the defense was, it was going to triple that peak by this years end, if not even more!
“How’s that all been working out?” is all I’ll ask.
But with a stock market valuation such as that in Amazon or Netflix, one is still being told/sold still: “it’s different this time.”
Maybe it is, and maybe its not. But if not? Let’s just assume this:
If one thought there was pain to be had HODL (holding on for dear life) in Bitcoin?
Pain is going to have quite a few variants of measure (i.e., such as severe, extreme, et cetera) should this FAANG family of stocks decide to turn around and suddenly take-a bite out of their masters 401K balance, without any warning, yes?
For clues, just ask any former Bitcoin millionaire.
© 2018 Mark St.Cyr