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Participant[quote=moneymaker]On average earnings are down, on average stock prices are up, I would call this dangerous! I’m thinking bubble, but to make money shorting would be very difficult or very lucky. Look how difficult is was for Bill Ackman to short Herbal Life, and he is a professional. Any business can be propped up, that is the nature of the stock market.[/quote]
Historical data for S&P P/E: http://www.multpl.com/table. Today, it’s sitting around 18-19. In 99-2000, it was 29-33. In 96-97, P/E was around 18-19. Here’s a graph of that data: http://www.multpl.com/. Hardly what I’d call a bubble.Participant[quote=bearishgurl]If your friend’s home is south of SJ, that is not SV. As stated before here, SJ is not really in “SV” either. Yes, Morgan Hill has some million-dollar-mcmansion subdivisions and, yes, it would be more expensive to live there than Fremont. HOWEVER, folks, GILROY, the GARLIC CAPITOL beckons and is cheaper to live in! I guess one could get used to the smell of garlic … or move into one of their far southeastern subdivisions :=0[/quote]
SJ is part of SV according to Wikipedia: http://en.wikipedia.org/wiki/Silicon_ValleyThe following Santa Clara County cities are actually located in the Santa Clara Valley and based on that status are traditionally considered to be in Silicon Valley (in alphabetical order):
Campbell
Cupertino
Gilroy
Los Altos
Los Altos Hills
Los Gatos
Milpitas
Monte Sereno
Morgan Hill
Mountain View
Palo Alto
San Jose
Santa Clara
Saratoga
Sunnyvale
The following Bay Area cities are (or were) home to various high-tech companies (or related firms like venture capital firms) and have thereby become associated with Silicon Valley:Belmont (San Mateo County)
Burlingame (San Mateo County)
East Palo Alto (San Mateo County)
Emeryville (Alameda County)
Foster City (San Mateo County)
Fremont (Alameda County)
Menlo Park (San Mateo County)
Millbrae (San Mateo County)
Newark (Alameda County)
Oakland (Alameda County)
Redwood City (San Mateo County)
San Bruno (San Mateo County)
San Carlos (San Mateo County)
San Francisco (San Francisco County)
San Mateo (San Mateo County)
Santa Cruz (Santa Cruz County)
Scotts Valley (Santa Cruz County)
South San Francisco (San Mateo County)
Union City (Alameda County)Participant[quote=livinincali]
For the private equity investors in FB before it went public they probably did have thousands of percent returns. Tech companies these days aren’t going public as early as they did in the past. Goldman Sacs probably has tons FB stock that translates to a dollar or less when they were early investors.It’s the valuation that matters not how much something has gone up. It’s it a bubble if the valuation doesn’t make any sense. Not whether it went up 1000% or 100%.
Look at CYNK. It has no revenue. It’s based in Belize with want I can tell is one employee and it’s gone from 0.06 to 9.74 in less than a month. That’s only a 16100% percent return.
I know the stock market is in a bubble. I do not know when it’s going to pop. I fully expect most people to fail to exit at or near the top even though they all think they’re smart enough to get out at the top. It’s just the nature of a bubble. If you think you’ll know the exit point is when TWTR goes up 1000% good luck. I doubt that’s going to be the signal for the top this time around.[/quote]Most of .com stocks in the 90s have negative earnings and very little revenue. It was all vapor wear. Which is why most of them went away. Yet, they still went up thousands of % in a very short period. This is thousands of % increase for your average retail investor, not private equity. I’m sure private equity back then made an even larger killing.
Yes, I agree with you that stock is not cheap today. But I disagree with the comparison of today vs the 90s. It’s still a long way away to get to 90s level bubble. Maybe today is like 96-97, expensive but not quite bubbly like 99-2000.
I never said anything about timing the top of the market. What I said is, you know you’re in a 99-00 level bubble is when everyone and their dogs are talking about buying stocks and giving stock tips.
Participant[quote=The-Shoveler]I have been there, not during rush hour, but my point is sprawl is happening and will happen.
Yea if you have money your not going to live there true, but lots of people with money do spend 90 minutes on the road one way almost every day who work in San Jose, I know and work with some of them.[/quote]I never understand why people would put up with 90 minutes commute. My limit is 5-15 minutes. In the past, when I was interviewing at GOOG and AAPL, first thing I did was scope out housing to see how much it cost for me to live 5-15 minutes away from those companies and have good school. They’re all well over $1M for your stand 4/2 1600 sq-ft place.
The way I see it, time is money. If you’re spending 3 hours each day in your car, if you live 5 minutes from work, you can either put that 3 hours each day working at your current job to get more work done and potentially lead to a promotion, spend more time with your family, or get another part time job. Not only will you save time to do more productive things, you also save $ in gas and car maintenance.
Participant[quote=joec]I’m generally not a fan of San Francisco city itself, but the bay area, I feel generally has better weather (not as hot) than LA or SD (IMO) and as most people say, just a lot more amenities that people seem to value.
SD might get there if we had more companies coming here since we’re a lower cost alternative to the bay area as quite a few people here used to live there…We do have all the nice theme parks here, just need another QCOM or something here really.[/quote]
I personally prefer SD’s weather over Bay area. It’s much more temperate. SF is too cold while SJ is too hot during summer and too cold during winter.I agree SD needs more companies. I hope it’ll come with time. Bay area have the educational advantage for a long time, which is why there’s so many companies up there. But with UCSD and SDSU feeding the city with educated entrepreneurs, maybe we’ll have more job opportunities in 20+ years. These things take time. Maybe all these biotech start up will become major employers some day.
ParticipantBG, you won’t find me complaining that SD got a few more development lined up. I wouldn’t be able to afford a place 5 minutes from work if SD went the way of SF so early on. But now that I’m an owner, I would love SD to go the way of SF :-).
As for MM, I’m all for greatly increase density. IMHO, it would only increase the desirability of the surrounding SFR. More density means more restaurants, more walkability, more services, more jobs, etc. All of those things are a plus in my book. Also, if Sorrento Valley/UTC continue to add more high rises and adding more jobs, I’m pretty sure more and more people will want to live closer to work and not have to deal with the crazy traffic. So, while you see it as a hassle factor, I see it as a major positive. Kind of like owning a SFR in Hillcrest, where there are a lot on high density areas. I view owning a SFR is a big positive, since you get both the advantage of density while still have your own space. So, I say, bring on the density. The more the merrier.
Participant[quote=The-Shoveler]That is the biggest complaint I hear from bay area workers, retirees don’t move!!
You do not hear that as much in LA or SD but there is a lot of I am staying until they carry me out here as well.[/quote]I think that’s because SF has been built out for awhile now. Add on to the fact that RE price has drastically increase (well above your average owners from awhile ago), which created this situation. I’m betting that SD will be in a very similar spot 50 years from now if population keep on growing and SD is fully built out. I see some of that now in Mira Mesa. There are a lot of houses around me that have owners who bought 15-30 years ago and either have very little mortgage left or are completely paid off. Those original owners are your blue collar workers who could afford Mira Mesa 15-30 years ago. If they sell today, they can’t afford to buy a bigger place in Mira Mesa or better. So, they just stay put.Participant[quote=The-Shoveler]Having been to SF quite a few times, I still don’t see the draw. I guess to each their own.[/quote]I’ve been to SF many times as well. I don’t see the draw either. My feeling of SF is cramp, old, and dirty. I much rather have Chicago like downtown. Even San Diego is much nice IMHO.
Participant[quote=livinincali]
QCOM in 1999 had a market cap of about 75 billion and annual revenues of about 4 billion. So there price to revenue was 18.75. FB has a market cap of 167 billion and revenues of roughly 10 billion = 16.7 price to revenue. TWTR is 23 billion market with revenue projected to be about 1 billion = 23.0 price to revenue. So in valuation terms FB and TWTR are pretty close to where QCOM was at the peak of the 1999 bubble. TWTR is higher, FB is slightly lower. The biggest difference is when they IPO QCOM was a IPO well before the bubble FB and TWTR have both IPOed somewhere in the middle of this bubble.[/quote]
QCOM is just one of those company I listed. There are many many more. How about INTC that went up 200% between 1998 to 2000, MSFT went up 150% between 98-2000, AMD went up 400% between 99-2000. Then there are the huge number of .com that are now completely delisted, like VerticalNet, Ariba, and other B2B, B2C companies. You can almost just throw a dart at a dart board with sticker symbols and you’d make a HUGE gain in spand of a few months.That’s just looking at the stock market over the 1-2 years before it popped. If you look at the longer range of 1995-2000, MSFT went up 1400%, INTC went up 1000%, QCOM went up 5300%, JDSU went up 18000%, etc. Even from the depth of the recession in 2008, these companies have only gone up 50-200%. Get back to me when FB or TWTR went up 18k%. I’ll be kind and say, if FB and TWTR can gain 1000% over 5 years like INTC did, then I would say it’s a bubble.
Participant[quote=livinincali][quote=AN]I think we’re still far far away from the 90s bubble. I remember buying anything with a .com and your “investment” would go up 50% in a few months.[/quote]
You mean like these recent IPOs
GPRO
KITE
ARDX
ZSPH
VNOM
MRD
ANET
RDUS
AGRX
SDPI
JD
SEMI
TRUE
ZEN[/quote]Back then, you can pick almost any stock (not just IPO) that have a .com and you can easily double your money in a few months. I’m not saying there aren’t overvalued stocks today. I’m just saying the irrational exuberance were much much more obvious back then. You know you’re in bubble territory when everybody is talking about how much money they made from stocks.Ariba, Inc. went up over 4X in 4 months.
JDSU went up over 4X in 4 months.
QCOM went up 3X in 2 months.I can go on and on. But you get the point. Not only start up were seeing 3x increase in stock price in a span of a few months. To be in the same scale today as it was in 1999-2000, FB has to be ~200, TWTR has to be ~180, etc.
ParticipantSeems like most people are matching or slightly beating the index. That’s great. Hopefully this will continue for all of us.
[quote=UCGal]I’m curious how you calculate your growth on your 401k?[/quote]I just use the % calculation from Fidelity. By my calculation, it seems like they’re taking gain divide by YTD contribution from you and your employer, then add it to your 1/1/14 balance.
[quote=JohnAlt91941]The stock market appears to be in a huge bubble, and hardly anybody is talking about it. Remind anyone of another bubble from the last decade?[/quote]I think we’re still far far away from the 90s bubble. I remember buying anything with a .com and your “investment” would go up 50% in a few months.
Participantprefab has come a LOOONG way. There are many luxury prefab housing companies now building some very luxurious looking places. Here are pictures of them: http://www.bing.com/images/search?q=luxury+prefab+homes&qpvt=luxury+prefab+homes&FORM=IGRE#a
Participant[quote=bearishgurl]
Understand your ideas. BUT … the NIMBYs in the most valuable coastal areas would have a field day if local zoning laws were changed to accommodate “prefab” living quarters on residential lots.[/quote] http://irontownhomes.com/portfolio/ It has already been done in Carlsbad ocean front.Participant[quote=HLS]Flu,
You are touching on part of the concern of the report which is that many people cannot qualify to buy (even with almost nothing down) because of lending guidelines…
SO… should it be easier for people to qualify to buy ??[/quote]Since I too also am in flu’s shoe, I would say, resoundingly, YES!!!!!. Lower the standard and let the house bubble start again. -
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