Selling AI stocks before year-end makes sense, right? New Congress, new House take over in January. Cost of living so tax hikes next year. Better to lock in gains now than pay more later? Besides cash is now bringing more than 4% pa
I expect Democrats to be as pro big business as they always have been - as long as they are "regulated" to be in sync with Democrats desires.
They'll be anti data centers until they are no longer the opposition party. Then suddenly both Republicans and Democrats will change while MAGA/America First and woke 2.0/socialists sides won't have changed at all.
Bought RAM online at a price unbelievable two years ago, shipment vanished on its way in logistic center in Germany. No one is getting any RAM at any price.
As usual, I was right about the market but way too early. I sold all of my AI-exposed stocks last year, as I knew the investment going into it couldn't be recouped in a reasonable time. If I'd held longer, I'd be up about 2x on those shares even if I'd only sold in a panic yesterday.
But, it also means I can probably reinvest in some of those stocks now that a correction is in progress. There are some excellent tech companies with strong leadership and strong growth (e.g. ARM) that have been too expensive for a long time; still too expensive, but getting closer to reasonable.
It's about timing and direction. Timing doesn't matter if it's not a well-run business.
Most of my holdings with AI exposure were and are well-run businesses; they were when I bought them, when I sold them, and throughout the AI-inspired rise. The problem was I didn't believe there was sufficient market opportunity to justify the stratospheric rise, and I think the market has now begun to catch up to that thinking. The market has begun to agree with the premise I based my decision to sell on.
I suspect the decline will continue and I will be able to buy back into at least some of the stocks I sold at a price better than what I sold them for.
So, yes, my post was to say I am frequently wrong on timing, even if the premise I based a decision on turns out to be true. I don't understand people, but I understand tech.
Yes, well, remember the dot-com boom/bust cycle? Lots of people lost a lot of money then but not all of those stocks ended up becoming worthless. Some held on to what they had and made a fortune once the internet-hype was over and the internet-era began. The same could happen with some - but certainly not all - of these 'AI-exposed' stocks. Once the 'AI' hype is over the 'AI era' will probably begin, especially if the dearth of RAM and matrix processing capacity is solved somehow.
That was the first time I was right but early. I sold out well before the peak to start a business with the money. I made money, roughly tripling my investment, but lots of folks made more money (and lots of folks lost a lot of money). In this case, I sold at a profit, but I could have made a bigger profit by being more slow to respond to my understanding of the market.
With all respect, you were not right. Your stocks are still above where they were when you sold them. To say that the stocks you held would at some point experience a large one day drop is a certainty.
I always find these market cap numbers misleading. The US stock market isn't "worth" $2.5T less. If you multiply the marginal share price by the total number of shares, you get a number that's $2.5T lower. That is something different. E.g., if you tried to sell all Nvidia shares at once, you'd never get anywhere near ~$4.5T (just as buying them all would cost far more).
What something's worth is what somebody is willing to pay for it.
And conventionally, we use the marginal buyer's bid as the measuring stick for public companies. e.g. the share price
Of course, the intrinsic value based on currently known data/fundamentals is unchanged.
But many market valuations are disconnected from that to begin with. Loans, options, warrants, many things are tied to the market cap/share price of a company. E.g. what is the LTV ratio when lending? What are my RSUs worth?
> What something's worth is what somebody is willing to pay for it.
This is completely and definitionally true in the context of trading, but keep this definition on a leash because if you apply it outside a purely financial context it tends to smuggle wealth-weighted objectives into your thinking, and regardless of whether or not you think that's moral you probably want to be aware of it. Example: feeding orphans is zero "value" because they can't pay you but merging the banks into a mega-bank to raise fees and collect bailouts has extreme "value" because it can make a bunch of obscenely rich shareholders even more obscenely rich and they can carve you off a mighty slice.
Due to this mismatch I keep both definitions in my pocket: Wealth Weighted Value for finance, People Weighted Value for more colloquial settings or moral analysis. "Exchange Value" is a good quasi-synonym for WWV if you want something less confrontational.
The point is that market cap doesn’t tell you what people are willing to pay for a company. When a stock price is $100, that means people are willing to pay $100 for one share. And then because big companies have a big market for their stocks, this can be extrapolated out to a few thousand or millions of shares without much loss of accuracy. But it falls apart when you go beyond a small fraction of outstanding shares. A $100 price may mean people are willing to pay $100 million for a million shares. But it probably doesn’t mean people are willing to pay $1 trillion for ten billion shares. At some point the marginal willingness to pay will shift.
This becomes visible in buyouts where the cost of acquiring a company is significantly higher than the share price multiplied by number of outstanding shares.
its the upper bound to value. Net worth is calculated as market cap of your assets, but look at Elon Musk. Right now there’s not enough people to buy his net worth his liquidation potential is drastically lower than his net worth. Ergo it’s a lie. Some people understand that, most don’t. It’s abused and marketing in some cases.
That is something different: liquidation value. Market cap tells you the sum total of the numbers next to this ticker symbol in everyone's brokerage account. It tells you the collective expectations about future returns and also the wealth effect that people feel based on their ability to individually obtain cash for shares.
It is true that neither of those things is liquidation value, but also liquidation value is neither of those things. If you expect a liquidation scenario, sure, use liquidation value. If you don't expect a liquidation scenario but want to measure collective expectations of and confidence in a stock, use market cap.
but it’s still so wrong. Like if I fund a company and I sell 1% to my mum who really believes in me for 100.000 USD I’m suddenly worth almost 10 million and the market cap of my company is 10 million, even though nobody might even pay a penny for my company. I don’t think most people are aware that this is how it works and crypto currencies have abused this a lot, by just selling a part of their shares, creating scarcity in the market and reaching high market caps. The traditional financial market is not that much different I feel like.
If Elon Musks sells all his shares the value of SpaceX and Tesla would drop dramatically I don’t know how much realistically he would be able to liquidate from his shares.
So the headline "is wiped" is misleading. I think it’s all ultimatively to get money in the markets and support growth
Many simplifying financial concepts only apply to liquid markets. Market cap is one of them. The entire notion that a stock can have a price is another (if liquidity is low, you need to sweat the order book). Our modern financial system has opted to use these simplifications and limit casually-accessible trading to times of day (and days of week and options strikes and expirations etc) with enough liquidity to support the simplifications.
The alternative would be to gate everything behind the more sophisticated concepts and limit access to people who had demonstrated competence -- and that's exactly what we do for illiquid markets. It's not like exchange servers turn off at 4pm, if you want to step outside the high-liquidity kiddie pool after-hours and OTC trading exist. However, I am not scandalized that the kiddie pool is full of toys and you shouldn't be either.
The point is still appropriate and relevant. I would have probably described it more like the same kind of con of American retailers that constantly run 80% off sales, which they come to by staking the fake sale percentage to a fake, fraudulent, made up number that the majority of the goods never sell for, i.e., MSRP.
Same clownish nonsense with this OP story, the S&P is still up 7.5% YTD, all that was lost is fabricated made up numbers on paper/screens. Now, if people sold stock and booked $2.5T in losses, then call me out please.
I can't stand the constantly lying, fraud, conning, and gaslighting. Maybe the market will drop more, maybe the counterfeit dollar market will go up. But reality is that noting is lost or made until you sell.
Valuation is a terrible name for that number because this number has nothing to do with value and everyone knows that. Everyone knows that if shares were sold by their current owners, their income wouldn't be anywhere close to that number. So a company value is a ridiculously small fraction of that number and absolutely impossible to determine from it.
I agree, its such a pet peeve of mine these sensationalist headlines. The price gets bid up, majority of shares were mostly bought at cheaper prices, but when there's a drop it's still 'new price x existing quantity' which means we lost X trillions.. Yet it never existed in the first place!
That's basically the same as anything that could be bought and sold though. Your house is worth what you could sell it for tomorrow, not an impossibly unlikely tomorrow in which all house owners decided to also sell. I don't even know how or why you would try to value according to some crazy scenario like that, but it would be much more misleading IMO.
Everything is valued in prevailing conditions. Conditions change, and value changes.
People in finance have largely (and correctly) agreed that the marginal buyer and seller represent the best guess for the value of the business with very few exceptions. There are various flaws with this, but you won't come up with a better method, I can guarantee it.
People in finance all profit from the same scheme.
I can come up with one right now. Instead of calculating it from the last price calculate it from some deepness in the order books. Realistically you cant drop just shares without moving the market so no company can just get 10% of shares dropped without losing a lot more in price impact. We only look at a small part of the market and the last price is practically the highest somebody on the world would pay for one more share. Nobody is buying for more. So its a upper bound not a good estimation.
The last price is also the lowest value that anybody in the world would sell one share for. Incredible that people never get this when it's the most basic thing: Every trade has somebody buying and somebody selling.
If I have 1 billion dollar in cash I can buy stuff for that 1 billion. If I have '1 billion' in stocks of one company I can not trade that 1 billion into cash. It is therefore not worth 1 billion.
This is a stupid suggestion. Go deep in the order book in which direction? There are both sell and buy orders. Last trade was both the highest someone would bid and the lowest someone would offer, by definition. Every trade is that.
On the flip side - if you wanted to buy all of NVIDIA shares - you would have to pay more than $4.5T - likely 20-25% premium. So this cuts both ways.
The peer-comments about the market cap being representative of the expected value, or present-value of cash-flows with some discount / risk adjustment are on point. (which implies that the change in market cap might be a change in cash-flows, change in discount (typically FedRate) or risk)
That same flaw applies to the category of "billionaires".
You can't just take the marginal share price and multiply by the total number of shares to magically get a number that is conceptually equivalent to your normie's brokerage or 401K account: A normie can liquidate their portfolios tomorrow at the market price, but no billionaire can.
Say my car is worth $15,000. But you could say “if you tried to sell it in the next 4 hours you’d never get that much”. And that’s true.
But nobody prices cars based on what you could sell them for in the next 4 hours because the market doesn’t normally transact like that.
Just like no one prices stocks based on how you’d get if you sold the entire market cap at once because the market doesn’t normally transact like that.
This is definitely scary, but not the end of the world (yet).
The S&P500 is still up ~7% YTD, and 5y CAGR of 9.4% before dividends, in line with historical norms.
This is primarily a decline in tech: week over week, the S&P is -4.5% (SPX), but the S&P excluding tech is +0.1% (SPXT).
Right now, this looks like speculation that tech will reduce capex after Q4 earnings (Nvidia, Micron, Sandisk, AMD all down >2x vs the S&P). But it'll take time to tell; most just announced Q3 a week ago.
All this to say: expect volatility, but no need to panic.*
A side note: TQQQ follows 3x intraday return if I remember correctly, but if you buy-and-hold TQQQ (or any other similar products), you will be hit by a lot of friction cost, and the return will be worse than 3x.
For all the federal election related takes, remember that
1. Market price changes are changes from what was expected before compared to what is expected now. And not even only in regards to the asset itself, but with respect to comparative change in other assets as well.
2. conventional wisdom when the branches of government are divided, less change comes from the government, so you can expect that your expectations for the future will remain stable, and that confidence reduces risk aversion, resulting in higher pricing.
Therefore, the market going down cannot be attributed purely to a question of who is in charge, because the democrats can't pass anything unless they get a nice number of Republicans on their (possible I suppose, but I don't think anyone is expecting that right now). But it could be attributed to expectations of what Republicans would do vs now that they can't.
Besides, it's basically impossible (or at least for layman, who knows if you're a market maker?) to accurately attribute a day's market behavior to any event, with a compelling causal explanation (sometimes your attribution could also be explained to have the opposite effect than the one you're trying to explain) and not ignoring alternate possible explanations.
It's kinda annoying when even otherwise serious people invoke the market movement of a day as an meaningful event that can be explained (notwithstanding that by tomorrow the effect might have reversed). But unfortunately business news like CNBC promotes that kind of thinking.
It's still quite possible that all the non federal items on the ballot (lots of anti data center referendums, lots of democrat politicians in state office) matter quite a bit.
Yes. I actually hadn't read the article before commenting because initially the link was to the Reddit thread. The data center buildout slowing, with Texas (among others) blocking otherwise expected to be built data centers is probably a significant justification for re-evaluating the business.
The "planned" capacity in Texas represented over 40% of the total power generation of the entire USA, how did the market think that was going to get built even without moratoriums?
Maybe they planned literally THOUSANDS of "walkaways" or "wheelhouses" with horses or cattle going round and round in circles powering generators, every 4 hours new, fresh horses go online and the previous go to pasture to eat more grass.
Grass / weeds to data center power conversion achieved !
Did social media REQUIRE to subvert democratic norms or is it just that social media was so good/powerful that it ended up inadvertently hurting democratic norms and that social fabric?
I didn't think your Facebooks and Twitters required shady data center deals and circumvention to actually establish a viable business model.
Neither. Governments and other politically aligned entities realized social media was useful and it was intentionally used to hurt democratic norms and the social fabric. It was neither an accident nor an intentional part of their business model (with Facebook being a possible exception.)
It's heresy to say here but related content algorithms aren't inherently evil.
>I didn't think your Facebooks and Twitters required shady data center
there were years of debate on whether or not a lot of the things early social media groups did constituted violations of, and not limited to : FTC Act Sect 5, the electronics communications privacy act, the CFAA, the video privacy protection act, and us state privacy laws from coast to coast.
they just did what they wanted, lawyered up, got big enough to lobby, and became legal ..
point is, these groups aren't stranger to 'shady deals'.
the people building datacenters don't want to go through the normal process. they want special exceptions to do whatever they like and put the externalities on other people.
I can never tell if the market’s movement has anything to do with the actual news cycle or is that just analysts ascribing their finger in the air analysis to things they only vaguely understand.
I remember one time essentially reading from a market watch article that the market was up because it was a Tuesday and people feel real good about Tuesdays.
I've wondered the same. But nevertheless that 75% probability becomes more of a certainty after the election, combined with all the smaller elections and ballot proposals that came in anti data center. Besides, there is always some uncertainty around the polls these days, and there's a bias towards not moving your money (for tax reasons if nothing else). But I'd love to hear from someone who works in the industry.
For public elections and not situations where a handful of people in the White House can make massive bets prior to an executive decision using insider trading knowledge?
1. What type of insider knowledge is the people in the white house supposed to have, except maybe some early dibs on some pending scandal?
2. If you're interested in the best probability estimates, using insider information is the way to go, even if it feels icky. The bigger issue is motivated people who want to manipulate the market to push a specific narrative.
Well, to me the gold standard in modeling is FLIPPR, which had the senate at 75% before polymarket did. And ultimately polymarket numbers may represent the opinion of (less expert?) modelers betting on the results (or that's nate silver's opinion anyway).
> And yet the markets rallied hard the day after the election. Why?
> * Maybe it was the removal of uncertainty.
Impossible to explain why the market does what it does on any given day, but almost certainly that was a mechanical response of reduced uncertainty and hedges being unwound as a result of that.
I agree that it'll probably level off soon enough. Traders seem to be trigger happy after elections. Pretty much every time. AI is not going away. Too many people already consider it "the norm."
Weather also can be kind of annoying. We might as well be talking to the clouds.
"Serious people" have no big reason to be in alignment. Thry can also display opporunistic, parasatic and status signalling behavior that benefts them more than others. Add population scale. Add social media noise/info overload factory. Add attention exploitation mechanisms. What do people control about it - nothing. Unless you live in China.
I think the most fascinating part about the whole thing is the complete and utter disconnect between the average American and the average HN contributor.
I hate to break it to you, the average American who just voted the way they did didn’t give a single crap about the market today. If they own any stock at all it’s not enough to move the needle in their daily lives. They care about the price of gas, the price of electricity, and if some rich Silicon Valley executive (likely hanging out here) is trying to take advantage of their small town community.
“Oh no, did a number in a spreadsheet go down for some rich guy? And?”
Interesting how the coverage of midterm elections was flagged with many users talking about how politics are not a hacker worthy topic but this somehow seems to be
Probably not. Most bubble prophets are tech journalists and are therefor unlikely to participate in the market (they make enough money reporting on it).
Additionally I suspect a lot of day traders are them selves AI boosters and are unlikely to believe the AI bubble is real.
The context is different. We learned about the circular financing deals in Oct 2025: https://news.ycombinator.com/item?id=45473033 and since then most people have been speculating a bubble which has inflated a lot in the year since.
The AI bubble is the background context, but on top of that there is the immediate context Anthropic S1 where we learned what journalists had been speculating for a while that the AI industry is in fact not nearly as large to justify the valuations of AI companies. And finally we have the election where local governments in the USA were elected on the grounds to stop the AI datacenter buildout.
Now with that context in mind the current dip does not look like some random and normal fluctuations in the market.
What is also different, for me at least, is that many of us (including my self) are rooting for the AI bubble to burst. And seeing these signs makes us existed that it is finally (maybe) starting to happen.
Scale matters though, right? A few hundred million here and there is vastly different from a few hundred billion. If this means Anthropic won’t IPO, that’s a win I think. Let them exist for another decade, examine the financials and then go public. That way we aren’t being dumped something on irrational exuberance.
Sounds scary until you realize that this happens about once per year on average. If this happens again tomorrow and a few more times in the few couple weeks that would be bad, but as of now it's notable but not a huge deal.
Not really - today was a rare and large sell off - last time that was close was 2020 - for the pandemic.
The question one should ask is how far down does it go and if history is any indicator it's not gonna be up from here before the new year (and likely down a bunch more). There is a LOT of over valued stocks still to be cleared out - I suspect the cut is gonna be a lot deeper. The history on this is 2018 for Trumps last midterm and a pending rate hike. Sticky oil prices are gonna drive inflation and the fed raise's the market suffers.
> There is a LOT of over valued stocks still to be cleared out
Gigantic amount of debt is contingent on datacenter buildouts and roi on it. All of that suddenly got repriced. This is a catalyst for a multi-year grind-down of the ai-trade. See 2000-2002 for a parallel.
America desperately needs January to come around fast. We need some level headed sensible people running the country. We need to elect more socialists to knock these tech companies down hard. Power to the people and fuck all this AI shit.
There's a lot of conjecture about how the midterms have caused the drop today but I can't help but think it may just be a convenient coincidence. Yesterday was one of the largest bumps of the year and by yesterday it was already known that Democrats were taking control.
Is this just the start of the fall that many people have been predicting for months? Did something materially change in the Democrats' stances or policies since yesterday? Or is something else unwinding entirely?
In fact the Wednesday bump could have precipitated today's correction as traders looking for a nice sale price window found one.
I would put this as part of the larger crunch in the AI trade that started just before earnings season as people digest what margin compression in traditional revenues for the big tech companies means going forward. Just with bigger swings because of the election.
That's not market manipulation. That's thinking "There's going to be a crash in the next couple of months, if it goes up to $x then I'll take the profits and cash out"
Inflation. When inflation is high, people want change. The democrats won because voters rejected inflation. (Which is the same reason Trump won in 2024, BTW, inflation was high, so voters wanted change). Anyway, if the democrats want to keep power in 2028, they have to deal with inflation, and deal with it hard and fast. That means (much) higher interest rates, lower government spending, and, possibly, tax increases. All of these make stocks go down.
There is no chance we will see lower government spending. Neither party is anywhere close in policy to what needs to be done to correct our spending problem.
It’s not better for the country if congress signs off on it either, though. 8+ trillion under Biden is a disaster. 7+ trillion under Trump’s first term is a disaster. Obama’s combined 9 trillion is a disaster.
Josh Johnson has a joke about how little this matters for the average person. How trillions can be lost overnight and your everyday Joe sees no changes.
Everybody who has been really angry with Elon Musk because he is a multi billionaire and that means he stole their money, are they now overjoyed with gratefulness for getting billions and billions of their stolen money back today?
bell-cot | 18 hours ago
novaRom | 17 hours ago
hoppp | 17 hours ago
ThunderSizzle | 17 hours ago
They'll be anti data centers until they are no longer the opposition party. Then suddenly both Republicans and Democrats will change while MAGA/America First and woke 2.0/socialists sides won't have changed at all.
Isn't the political party system great!
cpursley | 17 hours ago
triceratops | 17 hours ago
Deliberately pay capital gains tax now on the off-chance taxes go up next year? You do you my friend.
hn_submit | 17 hours ago
Anthropic and OpenAI will disintegrate and vanish in the mist.
That's all folks!!!
drivebyhooting | 17 hours ago
yread | 17 hours ago
throwaway384034 | 17 hours ago
amelius | 17 hours ago
silverFork | 17 hours ago
dude250711 | 16 hours ago
Ritewut | 16 hours ago
dylan604 | 16 hours ago
pixelatedindex | 11 hours ago
lifestyleguru | 4 hours ago
SwellJoe | 17 hours ago
But, it also means I can probably reinvest in some of those stocks now that a correction is in progress. There are some excellent tech companies with strong leadership and strong growth (e.g. ARM) that have been too expensive for a long time; still too expensive, but getting closer to reasonable.
cgeier | 17 hours ago
curiousllama | 17 hours ago
gopher2000 | 17 hours ago
SwellJoe | 17 hours ago
Most of my holdings with AI exposure were and are well-run businesses; they were when I bought them, when I sold them, and throughout the AI-inspired rise. The problem was I didn't believe there was sufficient market opportunity to justify the stratospheric rise, and I think the market has now begun to catch up to that thinking. The market has begun to agree with the premise I based my decision to sell on.
I suspect the decline will continue and I will be able to buy back into at least some of the stocks I sold at a price better than what I sold them for.
So, yes, my post was to say I am frequently wrong on timing, even if the premise I based a decision on turns out to be true. I don't understand people, but I understand tech.
hagbard_c | 17 hours ago
SwellJoe | 17 hours ago
png732 | 16 hours ago
SwellJoe | 16 hours ago
png732 | 15 hours ago
tjwebbnorfolk | 17 hours ago
SwellJoe | 16 hours ago
But, also, right but early isn't worth much. I've sold too soon many times...most often making money, but selling early in the rise.
0xy | 14 hours ago
schnuri | 17 hours ago
curiousllama | 17 hours ago
adam_arthur | 17 hours ago
And conventionally, we use the marginal buyer's bid as the measuring stick for public companies. e.g. the share price
Of course, the intrinsic value based on currently known data/fundamentals is unchanged.
But many market valuations are disconnected from that to begin with. Loans, options, warrants, many things are tied to the market cap/share price of a company. E.g. what is the LTV ratio when lending? What are my RSUs worth?
smallmancontrov | 16 hours ago
This is completely and definitionally true in the context of trading, but keep this definition on a leash because if you apply it outside a purely financial context it tends to smuggle wealth-weighted objectives into your thinking, and regardless of whether or not you think that's moral you probably want to be aware of it. Example: feeding orphans is zero "value" because they can't pay you but merging the banks into a mega-bank to raise fees and collect bailouts has extreme "value" because it can make a bunch of obscenely rich shareholders even more obscenely rich and they can carve you off a mighty slice.
Due to this mismatch I keep both definitions in my pocket: Wealth Weighted Value for finance, People Weighted Value for more colloquial settings or moral analysis. "Exchange Value" is a good quasi-synonym for WWV if you want something less confrontational.
wat10000 | 16 hours ago
This becomes visible in buyouts where the cost of acquiring a company is significantly higher than the share price multiplied by number of outstanding shares.
jwpapi | 16 hours ago
wat10000 | 15 hours ago
danielmarkbruce | 12 hours ago
How does one talk so confidently about something they know nothing about?
jwpapi | 2 hours ago
smallmancontrov | 17 hours ago
That is something different: liquidation value. Market cap tells you the sum total of the numbers next to this ticker symbol in everyone's brokerage account. It tells you the collective expectations about future returns and also the wealth effect that people feel based on their ability to individually obtain cash for shares.
It is true that neither of those things is liquidation value, but also liquidation value is neither of those things. If you expect a liquidation scenario, sure, use liquidation value. If you don't expect a liquidation scenario but want to measure collective expectations of and confidence in a stock, use market cap.
jwpapi | 16 hours ago
If Elon Musks sells all his shares the value of SpaceX and Tesla would drop dramatically I don’t know how much realistically he would be able to liquidate from his shares.
So the headline "is wiped" is misleading. I think it’s all ultimatively to get money in the markets and support growth
smallmancontrov | 2 hours ago
The alternative would be to gate everything behind the more sophisticated concepts and limit access to people who had demonstrated competence -- and that's exactly what we do for illiquid markets. It's not like exchange servers turn off at 4pm, if you want to step outside the high-liquidity kiddie pool after-hours and OTC trading exist. However, I am not scandalized that the kiddie pool is full of toys and you shouldn't be either.
tyrabound | 16 hours ago
Same clownish nonsense with this OP story, the S&P is still up 7.5% YTD, all that was lost is fabricated made up numbers on paper/screens. Now, if people sold stock and booked $2.5T in losses, then call me out please.
I can't stand the constantly lying, fraud, conning, and gaslighting. Maybe the market will drop more, maybe the counterfeit dollar market will go up. But reality is that noting is lost or made until you sell.
mminer237 | 16 hours ago
scotty79 | 6 hours ago
hacker_9 | 17 hours ago
stinkbeetle | 17 hours ago
Everything is valued in prevailing conditions. Conditions change, and value changes.
danielmarkbruce | 17 hours ago
jwpapi | 16 hours ago
I can come up with one right now. Instead of calculating it from the last price calculate it from some deepness in the order books. Realistically you cant drop just shares without moving the market so no company can just get 10% of shares dropped without losing a lot more in price impact. We only look at a small part of the market and the last price is practically the highest somebody on the world would pay for one more share. Nobody is buying for more. So its a upper bound not a good estimation.
carlosjobim | 13 hours ago
jwpapi | an hour ago
danielmarkbruce | 13 hours ago
Leave finance to people who have a clue.
jwpapi | an hour ago
ghshephard | 16 hours ago
The peer-comments about the market cap being representative of the expected value, or present-value of cash-flows with some discount / risk adjustment are on point. (which implies that the change in market cap might be a change in cash-flows, change in discount (typically FedRate) or risk)
notSupplied | 16 hours ago
You can't just take the marginal share price and multiply by the total number of shares to magically get a number that is conceptually equivalent to your normie's brokerage or 401K account: A normie can liquidate their portfolios tomorrow at the market price, but no billionaire can.
aeternum | 16 hours ago
refurb | 14 hours ago
Say my car is worth $15,000. But you could say “if you tried to sell it in the next 4 hours you’d never get that much”. And that’s true.
But nobody prices cars based on what you could sell them for in the next 4 hours because the market doesn’t normally transact like that.
Just like no one prices stocks based on how you’d get if you sold the entire market cap at once because the market doesn’t normally transact like that.
curiousllama | 17 hours ago
The S&P500 is still up ~7% YTD, and 5y CAGR of 9.4% before dividends, in line with historical norms.
This is primarily a decline in tech: week over week, the S&P is -4.5% (SPX), but the S&P excluding tech is +0.1% (SPXT).
Right now, this looks like speculation that tech will reduce capex after Q4 earnings (Nvidia, Micron, Sandisk, AMD all down >2x vs the S&P). But it'll take time to tell; most just announced Q3 a week ago.
All this to say: expect volatility, but no need to panic.*
*(Unless you're in TQQQ. Then panic.)
staticman2 | 17 hours ago
lachlanj | 17 hours ago
outside1234 | 16 hours ago
masfuerte | 17 hours ago
TQQQ is the only ETF (Exchange-traded Fund) that targets 3x the daily returns of the Nasdaq-100 Index.
Ouch!
Gathering6678 | 13 hours ago
foolswisdom | 17 hours ago
1. Market price changes are changes from what was expected before compared to what is expected now. And not even only in regards to the asset itself, but with respect to comparative change in other assets as well. 2. conventional wisdom when the branches of government are divided, less change comes from the government, so you can expect that your expectations for the future will remain stable, and that confidence reduces risk aversion, resulting in higher pricing.
Therefore, the market going down cannot be attributed purely to a question of who is in charge, because the democrats can't pass anything unless they get a nice number of Republicans on their (possible I suppose, but I don't think anyone is expecting that right now). But it could be attributed to expectations of what Republicans would do vs now that they can't.
Besides, it's basically impossible (or at least for layman, who knows if you're a market maker?) to accurately attribute a day's market behavior to any event, with a compelling causal explanation (sometimes your attribution could also be explained to have the opposite effect than the one you're trying to explain) and not ignoring alternate possible explanations.
It's kinda annoying when even otherwise serious people invoke the market movement of a day as an meaningful event that can be explained (notwithstanding that by tomorrow the effect might have reversed). But unfortunately business news like CNBC promotes that kind of thinking.
foolswisdom | 17 hours ago
yojo | 17 hours ago
foolswisdom | 16 hours ago
SteveNuts | 16 hours ago
dylan604 | 16 hours ago
Wait, what? When does the market think at all?
mminer237 | 16 hours ago
Freedom2 | 15 hours ago
DivingForGold | 14 hours ago
Grass / weeds to data center power conversion achieved !
ted_bunny | 56 minutes ago
shimman | 16 hours ago
dylan604 | 16 hours ago
bdhe | 15 hours ago
I didn't think your Facebooks and Twitters required shady data center deals and circumvention to actually establish a viable business model.
krapp | 15 hours ago
It's heresy to say here but related content algorithms aren't inherently evil.
serf | 12 hours ago
there were years of debate on whether or not a lot of the things early social media groups did constituted violations of, and not limited to : FTC Act Sect 5, the electronics communications privacy act, the CFAA, the video privacy protection act, and us state privacy laws from coast to coast.
they just did what they wanted, lawyered up, got big enough to lobby, and became legal ..
point is, these groups aren't stranger to 'shady deals'.
bdhe | 10 hours ago
gottorf | 15 hours ago
I'm not seeing the relationship between building datacenters and subverting democratic norms. Could you explain?
ferrouswheel | 14 hours ago
pixelatedindex | 12 hours ago
mgh2 | 17 hours ago
Nvidia can be down to 3-3.5T market cap from 5-5.7T heights
rconti | 16 hours ago
The market should have already priced in an almost-certain Democrat takeover of the House, and a 75% chance of takeover of the Senate.
And yet the markets rallied hard the day after the election. Why?
* Maybe it was responding positively to the scale of the Democrats' win, for whatever reason.
* Maybe it was the removal of uncertainty.
* Maybe it was reacting positively to the fact that there weren't massive irregularities, lawsuits, chaos, extended vote delays, etc.
But then flipping even harder negative the day after is even harder to explain purely in electoral terms. Maybe it was just time.
B4uler5 | 16 hours ago
I remember one time essentially reading from a market watch article that the market was up because it was a Tuesday and people feel real good about Tuesdays.
foolswisdom | 16 hours ago
dylan604 | 16 hours ago
foolswisdom | 16 hours ago
gruez | 16 hours ago
Maybe if you were looking at the most optimistic forecasts. Most forecasts and betting markets had it at 50-50
foolswisdom | 16 hours ago
lovich | 13 hours ago
For public elections and not situations where a handful of people in the White House can make massive bets prior to an executive decision using insider trading knowledge?
gruez | 6 hours ago
1. What type of insider knowledge is the people in the white house supposed to have, except maybe some early dibs on some pending scandal?
2. If you're interested in the best probability estimates, using insider information is the way to go, even if it feels icky. The bigger issue is motivated people who want to manipulate the market to push a specific narrative.
lovich | 4 hours ago
Is that a real question?
foolswisdom | 4 hours ago
gottorf | 15 hours ago
> * Maybe it was the removal of uncertainty.
Impossible to explain why the market does what it does on any given day, but almost certainly that was a mechanical response of reduced uncertainty and hedges being unwound as a result of that.
bentt | 12 hours ago
My guess is this levels off after a week.
ksaj | 6 hours ago
dist-epoch | 16 hours ago
"The market went down because the Fed increased the rate"
sjdh76 | 13 hours ago
tw04 | 10 hours ago
I hate to break it to you, the average American who just voted the way they did didn’t give a single crap about the market today. If they own any stock at all it’s not enough to move the needle in their daily lives. They care about the price of gas, the price of electricity, and if some rich Silicon Valley executive (likely hanging out here) is trying to take advantage of their small town community.
“Oh no, did a number in a spreadsheet go down for some rich guy? And?”
shevy-java | 17 hours ago
It will be a long time required here, investigating all corruption that has been happening.
Inflation increase should be viewed as a mafia in charge of a country.
vladmk | 17 hours ago
dudefeliciano | 17 hours ago
huqedato | 17 hours ago
dude250711 | 16 hours ago
runarberg | 16 hours ago
Additionally I suspect a lot of day traders are them selves AI boosters and are unlikely to believe the AI bubble is real.
overfeed | 15 hours ago
rationalist | 14 hours ago
hacker_9 | 17 hours ago
It's interesting reading the panic then in the comments, and yet now the nasdaq is up 65% from those lows, even with today's drop.
runarberg | 16 hours ago
The AI bubble is the background context, but on top of that there is the immediate context Anthropic S1 where we learned what journalists had been speculating for a while that the AI industry is in fact not nearly as large to justify the valuations of AI companies. And finally we have the election where local governments in the USA were elected on the grounds to stop the AI datacenter buildout.
Now with that context in mind the current dip does not look like some random and normal fluctuations in the market.
What is also different, for me at least, is that many of us (including my self) are rooting for the AI bubble to burst. And seeing these signs makes us existed that it is finally (maybe) starting to happen.
pixel_popping | 12 hours ago
I believe that will continue regardless of regulations, as long as Co Y and Co X is allowed to buy from Co N, then that can't be fixed.
pixelatedindex | 11 hours ago
jrflo | 17 hours ago
zer00eyz | 17 hours ago
The question one should ask is how far down does it go and if history is any indicator it's not gonna be up from here before the new year (and likely down a bunch more). There is a LOT of over valued stocks still to be cleared out - I suspect the cut is gonna be a lot deeper. The history on this is 2018 for Trumps last midterm and a pending rate hike. Sticky oil prices are gonna drive inflation and the fed raise's the market suffers.
Tadpole9181 | 16 hours ago
bwfan123 | 13 hours ago
Gigantic amount of debt is contingent on datacenter buildouts and roi on it. All of that suddenly got repriced. This is a catalyst for a multi-year grind-down of the ai-trade. See 2000-2002 for a parallel.
ChrisArchitect | 17 hours ago
Nasdaq plummets 4% into correction territory
https://news.ycombinator.com/item?id=50381623
silverFork | 17 hours ago
i_love_retros | 17 hours ago
donohoe | 16 hours ago
outside1234 | 16 hours ago
MSM | 16 hours ago
Is this just the start of the fall that many people have been predicting for months? Did something materially change in the Democrats' stances or policies since yesterday? Or is something else unwinding entirely?
CoolestBeans | 16 hours ago
I would put this as part of the larger crunch in the AI trade that started just before earnings season as people digest what margin compression in traditional revenues for the big tech companies means going forward. Just with bigger swings because of the election.
dylan604 | 16 hours ago
How do you manipulate the market like that and not get caught?
AndrewDucker | 15 hours ago
pjdemers | 16 hours ago
alex43578 | 16 hours ago
anon7000 | 7 hours ago
alex43578 | 4 hours ago
aidenn0 | 16 hours ago
CodeCompost | 16 hours ago
bloggie | 16 hours ago
u1hcw9nx | 16 hours ago
zmmmmm | 16 hours ago
Ritewut | 16 hours ago
JohnTHaller | 16 hours ago
schmookeeg | 15 hours ago
"Why are divorces so expensive? Because they're worth it"
As someone not terribly political, all I have is "ouch, my bank balance!" :) but this too shall pass.
png732 | 14 hours ago
carlosjobim | 13 hours ago
TheUnhinged | 8 hours ago
BatchJob | 13 hours ago