November 3, 2020

10 signs the bubble has already popped

 All the signs of a bubble are there, including:

  1. an IPO mania;
  2. extraordinary valuations and new metrics for valuation;
  3. a huge market concentration in a single sector and a few stocks;
  4. a second tier of stocks that most people haven’t heard of at S&P 500-type market
  5. the more fanciful and distant the narrative, it seems the better the stock performs;
  6. outperformance of companies suspected of fraud based on the consensus belief that
    there is no enforcement risk, without which crime pays;
  7. outsized reaction to economically irrelevant stock splits;
  8. increased participation of retail investors, who appear focused on the bestperforming names;
  9. incredible trading volumes in speculative instruments like weekly call options and
    worthless common stock; and
  10. a parabolic ascent toward a top


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