Strictly gossip-level, but the bold predictions gets it a mention. It’s Breitbart, so understatement isn’t going to feature:
San Francisco, heartland of wacky progressive politics but also home to some of America’s most innovative technology companies, is in trouble. Not just trouble, actually, but serious shit. […] And the main reason is China. The Wall Street Journal has a good explainer on what’s going on over there, but the basic thing you need to understand is that a lot of glossy American stocks are about to take a tumble, especially tech stocks.
The core of the analyis:
Fear and greed run the stock market, which is, of course, exactly as it should be: they’re the instincts upon which capitalism is built. But that’s a problem for companies who suffer dramatically when global events conspire to shunt investors into safer bets. […] Businesses like Twitter and Facebook have always been grotesquely overvalued, according to conventional analyses. Technology companies get away with hilarious valuations mainly thanks to upward pressure; the inflation happens right at the start when companies raise hundreds of millions of dollars on multimillion dollar valuations, despite not earning a penny in revenue and having no immediate plans to do so. […] That’s in outrageous contradiction to their price-to-earnings ratio, one traditional and very reliable way of valuing companies. […] Tech stocks have absurdly high price-to-earnings ratios, and any blip in the market has a much bigger effect on high PE stocks than low PE stocks. So investors are counting on massive future growth that will likely never come and betting against global events that shave billions off the value of frothy investments.
It could get a little rough.