Cypherpunks Mailing List: Today's Market Sees a Resurgence of Dot-Com Boom Excitement. Cathie Wood is Playing Henry Blodget and Jack Grubman, and Nasdaq is Playing Nasdaq.

The following is an AI translation kept for private records.

The original is from Wall Street, but I'm posting it here as it was shared.

By Pam Martens and Russ Martens: April 3, 2024 ~

"The old economy was stagnant, with empty runways. The market functioned as a huge, irregular mechanism that improperly allocated capital across America," Chernow writes.

Improperly allocating capital across America, moving away from the "old economy"? Hmm. Today, airplane parts are falling off commercial airliners, and there are dangerous bridges. Meanwhile, Donald Trump's startup, Trump Media & Technology Group (owner of the social media platform primarily used by Trump to disparage sitting judges and elected officials), has a market capitalization of $5.5 billion, trading at 1,800 times its revenue. According to Monday's SEC filing, the company posted a loss of $58.19 million last year on a meager revenue of $4.11 million.

Where is Trump's company traded? Nasdaq, of course.

After the dot-com bubble burst, Nasdaq lost so much credibility that it didn't reset its March 2000 high for another 15 years. In fact, it remained more than 50% below that high until 2007.

Ultimately, Wall Street had a cadre of rogue analysts who became the wind beneath Nasdaq's dot-com wings.

These analysts were effective scouts for pushing out lemon companies, promoting them as hot IPOs while calling them dogs and crap in internal emails. The analysts and their bosses got rich on bonuses while investors held portfolios of bankrupt companies.

On April 28, 2003, the Securities and Exchange Commission settled cases with 10 major Wall Street banks regarding fraudulent research practices for $875 million. No one went to jail. Only two individual analysts were charged: Jack Grubman, formerly of Citigroup's Salomon Smith Barney unit, and Henry Blodget of Merrill Lynch. Both were banned from associating with Wall Street firms in the future and paid fines representing a portion of the bonuses they collected.

The same Wall Street banks that settled with the SEC in 2003 are still permitted by the SEC to issue research reports on companies whose stock and bond offerings they underwrite.