Imo, I have little exposure to the craziness, and I think that, yeah, it could go on for longer. But it's a pure gamble, right? And that's the whole point. You can try to ride the wave - and you might make lots of money with your greed/patience - but eventually you will get killed playing Russian Roullette.
My gut says companies with stretched valuations already are playing accounting games - it's just not come to light yet. Only the most eagle-eyed analysts will be able to spot it. And, to me, in this market, the only guys looking hard enough are the shorts. Frankly, I don't care enough to look at these companies because I think there's only money to be lost trying to short these names (on the upside, maybe if you're right quickly, you're ego/fame gets stroked). I'm an arrogant a-hole, but I know my limits lol.
As for issuance, it's possible that Wall St's printing press may be the undoing of this bubble. But rates are up and capital isn't that easy to raise - I think this bubble won't spread everywhere as it did in '21. The only way it does is if somehow the narrative of AI leads to higher profits for every single corporation. I doubt that'll catch on.
Saylor's strategy at MSTR is insane. I don't think anything he's doing is inherently wrong, but, my gosh, the leverage... it's so stupid. FWIW, some people online call it a Ponzi. I don't think it is. It's just reckless. Of course, the more BTC runs (and it'll probably hit $100k based on the hype), the higher (and faster) MSTR will rocket. Maybe that creates problems as they continue to mop up more and more.
That said, what I especially didn't like was Saylor compared the premium to NAV to paying premiums on stocks like Meta/Apple. How Saylor can get away with saying that is outrageous! You buy Apple because of the residual cash flows you expect to receive. What cash flows does BTC compensate MSTR shareholders with? None. You're just taking a punt on an overpriced + leveraged bet on BTC (a commodity, btw) with the premium MSTR HODLers are paying coming down to the expectation that BTC will continue to run higher - on what basis exactly? It's a dangerous game. Unless, of course, you know something I don't that suggests that annually BTC will appreciate at insane rates for the coming years.
This was one argument I read for owning MSTR instead of 1 BTC for the price of 1 BTC -
Because I’ve held MSTR for years and the shares I own have > 50% more bitcoin per share than they did when I bought them. And in 2 years they’ll have 200% more Bitcoin.
And, to an extent, history would prove him right. But leverage risk + dilution risks + speculative underlying asset risk + at a stupid premium to NAV risk + BTC ETFs providing more cost effective alternatives... meh, maybe I'm too old to understand this one. But, as I say, it'd also be madness to try and short this one. |
