"Race To $2 Trillion" Has Now Entered The WS Vernacular
- Thread starter vanzandt
- Start date
The way they are trading they will have 3 trillion dollar market caps by 2021. 3 companies making up half the US gdp. Yep something is very very very wrong, but as they say this time its different. Right?
There you go. Stock price is absolutely ludacris. There is absolutely nothing that warrants apples stock price at where it trades today.
I disagree with that. Yes its easier now for the Dow to go up 1000 points than it was in say the year 2000, its all a percentage thing like you say.... the actual number is arbitrary... but these are real companies and we are talking real dollars. Has our GDP went up 50% in the last two years? Has the world's? There's only so much money out there. Last I looked, John and Suzie Q. Consumer haven't seen their paychecks jump 50% in the last 2 years, and where the rubber meets the road... a business is a business is a business.
The only thing going up with these companies is their multiples and that expansion is not justified when GDP's worldwide are anemic. Either these companies take that money from other companies, which AMZN has done quite well, or something is seriously amiss.
It is money printing, but you can mark my word, water always seeks its level. When the printing ends, there's no more growth... and PE's of 30+... they drop to the 10's.
If you bought microsoft today and took it private, it would take you 39 years to recoup your investment. Sure that doesn't include growth, but right now MSFT has PEG ratio near 3. That's ridiculous. Where's all that money going to come from? I can find a dozen examples like this.