yeah its probably this, market caps on some of these money losers is stratospheric. I think alot of people forgot the lessons of 2000. Take Palantir, a company that is 11 years old and for the past 3 years has lost 600M a year. What monopoly will this company carve out for itself to achieve this lofty valuation?
Or lets look at doordash [1] despite the pandemic and most of its workers not being employees(low paid gig workers) it is still losing money at an astounding rate: $533M last year and with a pandemic bump of only a 149M loss this year so far(it expects orders to slow alot after the pandemic).
I feel like I am Michael Burry in the big short playing my drums pointing out the obviousness of the huge crash that is coming with alot of these companies. What is scary is alot of americans and foreigners for that matter have their retirement savings(401k) tied up into these mini-titanics. When the fed's tap gets turned off, expect a reckoning.
What makes you think the fed's tap will ever get turned off?
What preconditions do you think we have to see before it happens?
In the past, every time I thought "the Fed will have to tighten soon" something happens which somehow, magically, always requires more easy money to solve.
Example: Easy money caused a housing bubble that burst? Now we need easy money to fix unemployment and keep the markets from seizing up.
It seems that politicians have now decided that the easy-money solution is always the easiest one, with the least traceable future negative ramifications.
It could happen with this Biden presidency, although most likely with whoever comes after him. If you think about easy money and interest rates, with Obama the lowering of interest rates made sense, the country was coming out of a long protracted recession and the money was needed to grease the gears of the economy so to speak.
With the Trump presidency he made his north star be the stock market(and keeping it high) and its why he heavily pressured the Fed to keep interest rates extremely low to supercharge the economy(and make him look good).
If a vaccine comes quickly and is highly effective long term and covid is eradicated by late spring/summer I expect a big jump in the stock market and a red hot housing market, this would be a time to slowly increase the interest rates, wall street won't like it but at some point it will have to happen.
