Chart of the Day

Afternoon Everyone.

I wanted to keep it short today and post two charts showing the similarities between todays markets, and the bubble markets of 2007 and 2000. The Dot-Com Bubble is most commonly remembered for it's insane exuberance for dot.com websites with no revenues, no customers, no money, and billion dollar valuations. The market valued 'daily unique visitors' and 'clicks', with no regard for fundamentals and actual business operations. Today it seems very similar. The chart below shows the exuberance for IPO's today. The only time the market ever loved a newly issued IPO more than today, was 1999.

The next chart shows one of my financial pet peeves. A SPAC. You can dress up a SPAC in all kinds of fancy financial jargon, but in essence it is a backdoor entrance to the stock exchange for companies that are too risky, or crappy, or illegitimate, or all of above. To list your company on the New York Stock Exchange, or any reputable exchange, generally there are guidelines and rules for you and your company to meet to give you the opportunity to list your companies shares and have them be freely traded. If your company has red flags and / or issues, generally it won't qualify to list on a reputable exchange. Below is a chart showing the number of SPACs created each year. You can see that the year 2020 already beat 2007 and is going for a new record. NOT A GOOD SIGN. Avoid newly minted crap, buy value and short junk.