A new powerhouse in the Silicon Valley
Internet and high tech companies are clearly getting some good valuations today with transactions such as Murdoch buying Intermix (parent company of MySpace) for $580m a few weeks ago, the IPO of PartyGaming on the LSE for $9bn, the IPO of baidu.com (Chinese search engine) on the Nasdaq or Yahoo! buying a stake in alibaba.com (Chinese again) for$1bn . Could this be a new bubble? I don't really know and in any case I cannot really buy any stock since I still haven't recovered from my losses from the last bubble. Yet I would be careful with stocks such as Google which are probably a bit overvalued now and it's actually not so surprising to see the company selling some additional shares for $4bn: the owners could very well believe that at $280 a share, this is the correct price.