A lot of people in my circle are calling for an economic depression.
I took a lot of calls from my very smart friends that have been shorting stocks as well as this rally rages on.
Even I have tried some S&P puts this week.
I mean the banks seem screwed, New York has delayed opening, commercial real estate seems overbuilt, travel will never be the same and local restaurants and hospitality are reeling.
BUT, the markets closed the week very strong in the face of all the horrible economic news.
On Friday night I got an email from Rob, the founder of Koyfin which said he was bullish on stocks (no mention of the economy).
Like Rob, I went to the markets themselves on Koyfin and started looking through the list of stocks I follow and own.
Even after the carnage of March, so many have bullish weekly and monthly setups.
Here is a small list of the stocks I found at or near all-time highs….
Shopify, Zoom, Docusign, Netflix, Amazon, Microsoft, Akamai, Teledoc, Cloudflare, Tesla, Nintendo, TEAM, Ring Central, COUP, Etsy, Johnson and Johnson, Abbot Labs, Amgen (many biotechs), XLV (the healthcare ETF).
Stocks do not listen to headlines, people do. Certain people reading the headlines have decided that there are stocks and areas of the economy that are and will thrive during and post COVID.
Yesterday morning I tweeted that my next set of podcasts would be titled ‘All-Time Highs – talking about stocks and the founders and venture capitalists behind these great companies and how to spot them, ride them and get off.’
Panic With Friends is not done, it is a great learning topic. But we have spent the last 45 days and likely the next 30 with panic and all the while, my guests have been talking about what is on the other side and that other side is already happening.
A lot of stocks are looking beyond which means a lot of people are too. Go back and listen to my Matthew Prince Interview just yesterday. Cloudflare is growing faster than ever.
Marc Andreesen and A16z seem to be tired of the panic as well. Yesterday afternoon they released a short essay titled ‘It’s time to build‘.
In fact, I think building is how we reboot the American dream. The things we build in huge quantities, like computers and TVs, drop rapidly in price. The things we don’t, like housing, schools, and hospitals, skyrocket in price. What’s the American dream? The opportunity to have a home of your own, and a family you can provide for. We need to break the rapidly escalating price curves for housing, education, and healthcare, to make sure that every American can realize the dream, and the only way to do that is to build.
Building isn’t easy, or we’d already be doing all this. We need to demand more of our political leaders, of our CEOs, our entrepreneurs, our investors. We need to demand more of our culture, of our society. And we need to demand more from one another. We’re all necessary, and we can all contribute, to building.
Every step of the way, to everyone around us, we should be asking the question, what are you building? What are you building directly, or helping other people to build, or teaching other people to build, or taking care of people who are building? If the work you’re doing isn’t either leading to something being built or taking care of people directly, we’ve failed you, and we need to get you into a position, an occupation, a career where you can contribute to building. There are always outstanding people in even the most broken systems — we need to get all the talent we can on the biggest problems we have, and on building the answers to those problems.
I expect this essay to be the target of criticism. Here’s a modest proposal to my critics. Instead of attacking my ideas of what to build, conceive your own! What do you think we should build? There’s an excellent chance I’ll agree with you.
Our nation and our civilization were built on production, on building. Our forefathers and foremothers built roads and trains, farms and factories, then the computer, the microchip, the smartphone, and uncounted thousands of other things that we now take for granted, that are all around us, that define our lives and provide for our well-being. There is only one way to honor their legacy and to create the future we want for our own children and grandchildren, and that’s to build.
By the way, there is money to build things.
My friend Shai Goldman at Silicon Valley Bank noted these recent large Venture Fund raises:
Of course on the other side of this money grab, PPP is already out of money, so it’s not all roses out there for people.
In late February through March, the stock market was the economy.
Equating the two though is generally a waste of time.