We were browsing a fine website when we saw this:
Photo: Business Insider
This is so typical of the current discussion on the “tech bubble” that we had to memorialize it. “Everything’s crashing, so it’s clearly a bubble!”
When there was a tech bubble, companies with no profits went public and their stocks shot to the moon. Today, a company with a billion dollars in profits and 40% y/y growth goes public and its stock tanks immediately. Clearly the same thing. (Facebook’s stock is probably overvalued, but a stock being overvalued is not the same thing as a bubble. Stocks get overvalued all the time. A bubble is when everyone goes crazy and only buys buys buys.)
In case you’re still not convinced this is just like Pets.com, here’s how all the hot tech IPOs are doing lately (click to enlarge):
Photo: Google Finance
Yep. 1999 all over again.