Weird Econ in the Valley

This is interesting/amusing: As Tech Stocks Rise, Silicon Valley Is Acting Like It's 1999

Close your eyes and it feels a little like 1999, that giddy, amazing, lost moment when Silicon Valley was the most important place on Earth and just about everyone in it was happily adding a zero or two to his or her net worth.

The stock prices of unproven Internet companies that no one has ever heard of, such as PacificNet Inc. and EuroWeb International Corp., are once again doubling in a single day. The tech-heavy Nasdaq composite index is up 56% from a five-year low reached in October. Insiders are happily selling shares, cashing in options that recently were fit only for making paper airplanes. Call a chic Bay Area restaurant such as Delfina or Betelnut or Greens on a typically dead night like Monday and you will be told, simply and sweetly, no table, no way. The hottest car is a $50,000 Hummer.

The future, once again, appears unlimited in many eyes.

Prices of Internet stocks such as United Online Inc. and EBay Inc. may seem sky-high, U.S. Bancorp Piper Jaffray analyst Safa Rashtchy wrote last week in his newsletter, but it "is hard for us to identify a negative catalyst The run is likely to continue."

So, the question is, have they just decided that things are good and going to get better, or, in fact, are things good and only going to get better?

Posted by Steven Taylor at July 13, 2024 01:52 PM | TrackBack