Brace yourselves for some eye-opening news from the world of billionaires and stocks. It seems like the big shots are starting to cash out, and it’s sending shockwaves through the market.
Take Michael Dell, for example. He recently unloaded a whopping $145 million worth of $DELL stock, adding to his total sales of $500 million over the past two months alone. And he’s not alone in this trend. Titans of tech like Zuckerberg and Bezos are also jumping on the sell-off bandwagon, offloading hundreds of millions in stock just this past month.
But here’s where it gets really concerning: Stock concentration is reaching levels not seen since the Great Depression. According to Goldman Sachs, the market cap of the largest stock is now a staggering 750 times the market cap of a 75th percentile stock. To put it in perspective, even during the peak of the 2000 Dot-com bubble, this metric only hit 550 times.
Yes, you read that right. We officially have a higher stock concentration than the peak of the Great Depression in 1932. The top 10% of stocks in the US now represent around 75% of the entire market.
In simpler terms? Big tech is practically the stock market. With such extreme levels of concentration, it’s no wonder that billionaires are starting to hit the panic button and cash out while they still can.
Adding to the unease, in the history of modern finance, no single indicator has done a better job of predicting when the next global recession will start than when the Bank of Japan starts raising rates. It’s considered foolproof!
So, what does this mean for us mere mortals in the investing world? Well, it’s a stark reminder that the market might be overheated and overvalued. As the titans of tech bail out, it’s a signal that perhaps it’s time to tread carefully and consider our own investment strategies.
Sources:
🚨Billionaires continue to cash out
Michael Dell sells another $145M worth of $DELL bringing his total sales to $500M over the past two months
Dell joins billionaires like Zuckerberg and Bezos offloading hundreds of millions in stock this past month
Interesting pic.twitter.com/WkTNK7SwFO
— Insider Tracker (@TrackInsiders_) March 19, 2024
Stock concentration is now at Great Depression levels:
According to Goldman Sachs, the market cap of the largest stock is now 750 TIMES the market cap of a 75th percentile stock.
To put this in perspective, even at the peak of the 2000 Dot-com bubble the metric only hit 550x.… pic.twitter.com/SPEn9diqea
— The Kobeissi Letter (@KobeissiLetter) March 19, 2024
In the history of modern finance, no single indicator has done a better job of predicting when the next global recession will start than when the Bank of Japan starts raising rates. Foolproof! pic.twitter.com/mcq3cyiUSx
— Peter Berezin (@PeterBerezinBCA) March 19, 2024
www.bbc.com/news/business-68594141