1/ The eventual reversion + shift
from GROWTH to VALUE
will take a while––
but I see ONE key catalyst:
a series of AOL/TimeWarner-like deals.
where smaller (more highly valued growth stock currency) consumes larger (cheaper cash-generating value biz’s, deemed in decline)...
2/ It will post facto finally bring reward to VALUE investors––
(who are facing growing, classic, end-of-cycle claims of the death of their strategy; from fund shutdowns to questioning Buffet to Damodoran as apologist)
––NOT because market sees the value they do...
3/ But IN SPITE of it––
as the market will have created crazy HIGH valuations of bad businesses that will buy good businesses at crazy LOW valuations
That will 1. put VALUE back in vogue 2. create tremendous SHORT opps as the combos fail
(but are good for book publishers)...
1/ We’re pleased to unveil Lux’s NEWEST investment vehicle
Lux Health Tech Acquisition Corp
a $300M special purpose acquisition company
which begins publicly trading on the Nasdaq [LUXAU] this morning...
2/ We formed Lux Health Tech
for the purpose of entering into a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination with one or more businesses at the intersection of the healthcare and technology industries...
3/ In PLAIN SPEAK:
we believe the time is now to take public and build generational technology companies that will have a profound positive impact on healthcare.
2/ Does the delicious taste of sweet chocolate exceed the bitter truth of supporting enslaved child labor of kids under 12 in Ghana or Ivory Coast picking cocoa beans that make chocolate?
(Y/N)?
3/ Most alarming was how easy it was for me to flip past this article in today’s @washingtonpost––while i LITERALLY bit into chocolate 🍫and sipped my morning coffee☕️
And then flipped back––startled by easy complacent ignorance.
2/ Beyond RobinHood or TradeRepublic or TikTok fast-money option speculators––with 0% rates–––“GROWTH” is what is demanded.
And
-with SPACs able to give proforma ‘forward guidance’ in ways IPOs couldnt
-and a dollar in 2025+ = to a dollar TODAY
Valuations continue to rise...
3/ SPACs themselves may be akin to late 1980s Junk Bonds when Milken took a once backwater asset and legitimized them through combo of academic + portfolio theory––
unleashing vast capital formation + wealth creation––until like all good things––it was taken to excess....