Thursday, June 30, 2005

Fed hikes rates a quarter-point: "The Federal Reserve raised short-term interest rates for the ninth time in a year Thursday, hiking its main benchmark to the highest level since shortly after the terrorist attacks of Sept. 11, 2001." —MSNBC
Hornik, Canter & the Momentary Merits of Conferences: "So why [attend all these conferences]? Well, for a long spell I wasn't, but I am now because we are at a kind of technology & market inflection point. There is an organic coalescence going on around some nascent platforms, technologies, ideas, and so on -- broadly this could be called Web 2.0, but I'll cede that label to O'Reilly -- and attending these things is currently the best way to get an in-you-face idea of where the smart people are looking. It's a kind of 'follow the alpha geeks' strategy, to paraphrase a meme." —Paul Kedrosky (UCSD)

BMW's and IPO's. Gotta love it.

Wednesday, June 29, 2005

Is $100 billion next for Google?: "As of Monday, Google stood at $84 billion in market cap. That's about $10 billion shy of Yahoo and eBay combined and more than Time Warner, and Walt Disney individually. Heck, another 18% move on the upside, and it'll be worth an even $100 billion." —AlwaysOn Network

Tuesday, June 28, 2005

Why the real estate bubble could be good news for the economy.: "Some might argue that all this money spent on housing could be better spent elsewhere—starting new businesses or paying down debt, for instance. But if we were going to have a tidal wave of excess liquidity flowing into any sector, real estate was as good a place as any—from a nationalistic and job-creation standpoint." —Slate
Real Estate: Is It Time to Cash Out?: "From San Francisco to Miami, Seattle to Boston, America's homeowners are asking the same crucial question: How do I protect the huge gains in my house? If you're part of the multitude who haven't saved nearly enough for their golden years, your house could prove your salvation." —Fortune

Unless everybody else decides to unload theirs too. Myself, I'm looking forward to cherry-picking the foreclosures.
Google Closes Above $300: "Wall Street likey the video play." —John Battelle

Monday, June 27, 2005

Nasdaq closes in on another test of 2,100: "Over the past three sessions, the markets have finally threatened to break higher. The Dow Industrials has cleared the April highs, and at Monday's close, the S&P 500 held just 13 points from three-year highs. Still, the Nasdaq - which arguably kicked off the current rally - has lagged the other two indexes, and now faces another test of resistance at the 2,100 level." —MarketWatch

Friday, June 24, 2005

The Get-Rich-Slow Scheme: "It's a lot easier to gain -- and keep -- wealth by building it at a measured pace. Here are some simple ways of doing so." —BusinessWeek

Thursday, June 23, 2005

Dow Plunges 166 As Oil Briefly Passes $60: "Stocks plunged Thursday, sending the Dow Jones industrials down 166 points as oil prices briefly moved past the psychologically important $60 per barrel level for the first time. Oil's advance accelerated a selloff prompted by poor earnings from FedEx Corp. - which blamed high fuel prices for its disappointing profits." —Associated Press

Time to sell some of that GOOG and buy some XOM!

Monday, June 20, 2005

The Mortgage Trap: "According to the Mortgage Bankers Assn., the share of new loans made to so-called subprime borrowers -- usually lower-income individuals with spotty credit histories -- rose to 28% in the second half of 2004, a sharp jump from the less than 5% of all lending that subprime represented back in 1994." —BusinessWeek

Friday, June 17, 2005

The Global Housing Boom: In Come the Waves: "Americans who believe that house prices can only go up and pose no risk to their economy would be well advised to look overseas." —The Economist

A twofer from the Economist. Sell now or forever hold your house.
House Prices: After the Fall: "There is a troubling similarity between the house-price boom and the dotcom bubble: investors have been buying houses even though rents will not cover their interest payments, purely in the expectation of large capital gains—just as investors bought shares in profitless firms in the late 1990s, simply because prices were rising." —The Economist

Thursday, June 16, 2005

Marc’s 24 Hour Laundry: "Silicon Beat is in hot pursuit of Marc Andreessen who apparently is on the board of new start-up, code named, 24 Hour Laundry. I guess the only thing that needs laundering is the reputation. Like many Web 1.0, Marc is looking for redemption. Lots of investments, including in 24HL which is video blogging, blogging meets social networking meets something..." —Om Malik on Broadband

Where have you gone, Jim Barksdale? A nation turns its lonely eyes to you. Woo woo woo.
The Trillion-Dollar Bet: "American homeowners have made a trillion-dollar bet that mortgage rates will remain low, but economists worry that the bet could turn bad." —New York Times
The Mortgage Trap: "Lenders are cranking out an ever-growing array of financing schemes and lowering standards to keep the housing boom going." —BusinessWeek

Wednesday, June 15, 2005

Housing Bubble Correction: "'If there is a real shift downward in housing demand, it would have a dramatic impact across the entire economy,' said John Benjamin, a professor of finance and real estate at American University. Millions of Americans have become dependent upon rising home values to support home-equity loans and mortgage refinancings, which can be used to pay for cars, remodeling projects, clothes and more. 'We live in a consumption economy that is financed by debt.'" —AlwaysOn Network

Tuesday, June 14, 2005

Rackable Systems IPO falls flat: "Rackable Systems fell for its third straight day Tuesday as the rare entry in the market for initial public offerings continues to draw meager interest." —MarketWatch

See related story: Two Dell PCs for $200 each shipped, no rebates
Another Dot-com Boom?: "Ryan Hemelaar writes 'CNN Money is reporting that the internet might be at a stage of another dot-com boom, with the top tech stocks now gaining ground again after the dot-com crash. From the article: 'Now, 10 years after two key events in the history of the Internet -- the successful IPO of Netscape, which many cite as the beginning of Wall Street's love affair with 'Net stocks, and the founding of Yahoo! -- we're in the midst of a new, let's say mini dot-com boom.''" —Slashdot

And if Slashdot says that Ryan says that CNN says it, it must be true.

Monday, June 13, 2005

Rising home costs a growing concern: "'The dramatic increase in the prevalence of interest-only loans, as well as the introduction of other relatively exotic forms of adjustable-rate mortgages are developments of particular concern,' [Fed Chairman Alan Greenspan] told a congressional panel." —MSNBC
Henry Blodget on Google, Bubbles, and Market Madness: "Now that the Great Bubble of the 1990s has receded into the past, we tend to dismiss it as a bizarre anomaly, a wacky blip in which everyone 'went nuts' and fell victim to irrationality, stupidity, and greed. But that's history, the story goes. We've returned to our senses. We're smart and rational now. We'll never make those mistakes again. Alas, the truth is more complicated." —Fortune

The mere fact that Henry Blodget is writing for Fortune confirms it. The bubble is back, baby!

Saturday, June 11, 2005

Google valuation fixation suggests peak is nigh: "Cisco climbed for another six weeks after it surpassed GE on its way to an all-time high in late March of 2000. In fact, Cisco's epic climb -- which turned many a rank-and-file employee into a millionaire -- lasted for nearly a decade. Perhaps Google's run will last as long. But those Google investors who think the stock won't eventually come back to earth should peruse a Cisco 10-year stock chart that covers the period 1995 to 2005." —MarketWatch

Friday, June 10, 2005

Venture Capital Rediscovers the Consumer Internet: "'I think it's great that the Internet consumer space is heating up again,' Mr. Sze said. 'But consumer is also quickly becoming a space where lots of venture capitalists are diving in without a clue.'"—The New York Times

Thursday, June 09, 2005

New hotels headed downtown: "'Austin was one of the last to rebound after the recession, but it's coming back strong now,' McCaslin said." —Austin American-Statesman

Wednesday, June 08, 2005

Growth Stocks Regain Favor: "Many major asset managers and investment strategists have been shifting toward growth stocks, arguing that such stocks have been so ignored for so long that they are now relative bargains." —The Wall Street Journal
Sky Dayton gets $440M for next venture!: "just read in business 2.0 (plenty of time for these mags in hawaii) that sky has launched an ballsy new venture to bring 3G wireless services to the US. ready for this? he has raised $440 million from earthlink and a korean telecom company. now that's what i call leverage!" —Mark Pincus
When ARMs Enter the Dicey Phase: "After a lull in home mortgage refinancings, lenders are preparing for a stampede. Some homeowners with hybrid mortgages are bracing for the riskier fluctuating phase to begin and many are refinancing to lock in a fixed rate." —The Wall Street Journal
Interest-Only Mortgages All the Craze: "'When this market adjusts, it's going to be painful,' said UCLA economics professor Edward Leamer, who has been warning of a California housing bubble for three years. 'Borrowers are getting in over their heads, and lenders are too.'" —AP via Yahoo! News

During Bubble 1.0, a friend of mine borrowed against unvested ISOs to buy more shares of the same company on margin. I think he now lives in a cardboard box.
Is the Bubble Back?: "Marc Goldberg wonders, ‘Is the bubble back?’ While it is always difficult to discern the size of a storm from the inside, we should consider a few questions..." —David Beisel (Masthead)
Bubble Watch: Google Bigger than Time Warner: "This is just too funny - a company that depends on AOL for a significant portion of its revenues is now bigger than AOL’s parent Time Warner, at least in market valuation terms." —Om Malik on Broadband

Tuesday, June 07, 2005

Apparently the blogospehere is less and less interested in the bubble. Ironic, no?
Real Estate Investing: Betting Against the House: "This is the strange reality of financial bubbles. When one really gets going, the people who—correctly—warn that it won't go on can be wrong year after year after year. Meanwhile, the overenthusiastic, ill-informed sorts who cast such worries to the wind can get seriously rich. Conventional economic theory holds that market prices are set by prudent and rational buyers and sellers. When all the profits flow to the imprudent and the irrational, though, they set the prices—and economic laws temporarily cease to apply." —Fortune
Bubble 'Freakonomics': "As Google flirts with the $300 mark -- fueled by three price targets above that level in the last week alone -- the market is beginning to feel eerily familiar to the halcyon days of 2000. If you're in the market for a home, the fear-driven sentiment is just as pronounced. Yet the prices move unrelentingly higher. For both real estate and certain blue-chip Internet stocks, it's clear that there really is at least some underlying value." —AlwaysOn Network
Google flirts with $300; trading 3.5 times IPO price: "Google Inc. shares came within a whisker of the $300 mark early Tuesday, less than a year after the world's top provider of Internet search services first sold shares directly to the public in its auction-style stock offering." —MarketWatch

Monday, June 06, 2005

Beware The Interest-Only Mortgage: "The danger lies as much with the bank that loaned the money as the home owner who borrowed it." —Forbes

With 63% of home loans being interest-only in the second half of last year, the question is no longer if the housing (and mortgage and construction and broader economy) bubble will burst, but when. You heard it here first.

Saturday, June 04, 2005

Far-reaching impact for stocks if home prices tumble: "If a much-feared crash in U.S. housing prices does indeed come to pass, many homeowners are likely to discover that more than just their house could be vulnerable to losses." —MarketWatch

Thursday, June 02, 2005

A Flip/Flop Bubble of Microventures?: "During the bust, all the Angels died and went to heaven. Luckily, some of those that did well during the boom stayed in the game and seeded most of the great new companies known today." —Ross Mayfield
EBay snaps up for $620 million: "In a bid to ignite growth, eBay said Wednesday that it's buying, an online-comparison shopping site, for $620 million in cash. The online marketplace will pay $21 a share of's shares, or a 20% premium, both companies announced. " —AlwaysOn Network

Way to go, SHOP! This marks the first acquisition of a Bubble 2.0 Index stock.