News
The “number goes up” is alive and well – and not just in the cryptocurrency sector: Morning Brief
This is the gist of today’s Morning Brief, which you can do registration to receive every morning in your inbox together with:
“The number goes up.”
It’s one of many memes that emerged during an earlier crypto wave, portraying a similar vibe to “on the moon” or “hodl” – the idea that believers would continue to buy in the belief that prices would continue to rise. (It is also the title of Zeke Faux’s seminal book on cryptocurrencies.)
Crypto bulls have highlighted what they believe are the key drivers of the current rally, including the introduction of bitcoin spot ETFs last month (“a situation where you buy the voice and you buy the event“); the imminent bitcoin halving; and speculation on the approval of Ethereum spot ETFs. There’s always something.
All this could increase prices. But it seems a safe bet that at least some of the recent enthusiasm is a Ouroboros-similar construct: people buy because they expect prices to continue to rise. Prices continue to rise because people are buying.
This mentality seems to have spread beyond the world of cryptocurrencies. Take a stroll through Yahoo Finance trending ticker page most days and you will see a lot of stocks rising. Part of it has to do with the current craze for all things artificial intelligence (NVDA, SOUND, BBAI), but it doesn’t stop there, and it looks different than the meme-driven cycle of 2020-2021. (Tuesday, for example, Viking therapy more than doubled, to the top of the trending page, upon news of a promising study of a slimming drug).
Maybe it’s the “casino behavior” which Warren Buffett emphasized in his recent letter to shareholders: Everyone wants to get rich by pulling the right lever. Of course you could also call it FOMO trading.
That’s what Bill Capuzzi calls him. The CEO of Apex Fintech Solutions believes that Generation Z and Millennials are particularly vulnerable. Trading data from its platform showed that trading activity around Meta earnings from those two generations increased by 175%, “reflecting the FOMO of younger generations.”
That said, it gives credence to twenty- and thirty-somethings who want to actively participate in their finances (and that’s its customer base, after all).
“Buying a mutual fund and putting it away for decades is not what the next generation wants,” he said in a note to Yahoo Finance.
Both cryptocurrencies and Nvidia – heck, even the S&P 500 – have taught investors that, indeed, “the numbers go up.” (In the case of cryptocurrencies, with a grueling winter in between, sure, but obviously it has recovered).
The story continues
Now comes the cautious clichés: nothing goes up forever/in a straight line. Trees don’t grow to the sky. And investors shouldn’t forget one important question amid all the excitement: “How many brands will drop?”
short morning image
Read the latest financial and business news from Yahoo Finance