There goes my 401k
Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
761–770 of 1001 posts
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#762That's how the new 1927 starts.
It will be in the history books.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#763For SpaceX (and possible the others): Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. From https://x.com/Hedgeye/status/2060435253928604065 : "Rule changes for the SpaceX $SPCX IPO: Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5. This forces over $30 trillion in passive 401k a…
This should be a 5 alarm fire. It reminds me of nothing more than organized crime rackets that targeted control of union retirement funds
But the SPCX float is a small fraction of its overall shares. So it will end up being around 0.08% to 0.12% of the weight of the SP500 [1]. Nothing to write home about.
Personally, I do think SpaceX is overvalued at these proposed IPO numbers and I will trade accordingly. So should anyone else who is confident and competent at taking appropriate market positions.
1. https://www.investmentnews.com/practice-management/spacexs-i...
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#764For SpaceX (and possible the others): Yes it can, since they changed the rules to force over $30 trillion in passive 401k and retirement money to buy SpaceX at IPO valuations. From https://x.com/Hedgeye/status/2060435253928604065 : "Rule changes for the SpaceX $SPCX IPO: Index providers waived the profitability requirement and cut the seasoning window from 90 days to 5. This forces over $30 trillion in passive 401k a…
Changing the rules to appeal to SpaceX is really really bad... especially given the historical performance of IPOs
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#765Earlier quoted context omitted.
Should one sell their 401ks ahead of the forced buying
In general you should never "sell your 401k." Period. (Short of using it for income during retirement.) What you should do is have an Investor Policy Statement[0]. This should contain at least two things: - your desired Asset Allocation (e.g. 30% U.S. stocks, 30% International stocks, 20% U.S. bonds, 20% International bonds) which should be decided upon based on specific, personal goals and risk tolerance - your stri…
Not sure if OP meant literally sell, or just rebalance out of stocks. TBH I've been considering sliding over to all bonds for a time, since there is no tax event if funds stay in the account. But the numbers don't seem that high at the end of the day.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#766Maybe to counter some of the apparently widely expected doom and gloom: - bubbles are notoriously unpredictable and generally don't happen when they are loudly and widely proclaimed to happen any minute now. - large scale infrastructure spending tends to be really good for economies. These three companies are creating lots of jobs that are mostly related to construction, energy infrastructure, hardware spending, etc.…
I have no crystal ball, but I feel uneasy when they change basic rules about indizes right before these IPOs. There are a lot of retirements on the line just by this fact. Maybe big tech gambled too close to the sun and found a way out? Whether something pops or not, it leaves a bad taste in my mouth this can be done so easily, don't you think?
> There are a lot of retirements on the line just by this fact
1) I would expect anyone close to retirement to have a fairly balanced portfolio.
2) if they don't include SpaceX and the stock does >10x in the next year, they'll end up doing terribly on the benchmarks. SpaceX is big, but if they invest early, it won't be a ridiculous % of the portfolio. Even if one overpays by 2x, since it's under .1% of the total portfolio. If it went to zero nobody would lose their shirts, they'd lose <.1% of their portfolio.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#767Earlier quoted context omitted.
What can those of us who are passive investors do to protect ourselves?
Not buy these index funds. If you don’t want to own the entire market, don’t buy funds that seek to own the entire market. Funds like ESGV which exclude companies with poor governance have existed for a very long time - I can’t find a clear answer as to whether or not it will buy SpaceX, but I’m sure you can find funds that cater to your desires.
Index funds don't represent "the entire market" anyway. They are a diversified selection of stocks choosen according to some rules.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#768Is there an index fund that intentionally only focuses on actually profitable companies? It would actually be nice to hedge some funds into non speculative assets.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#769All these things are apparently valued at trillions of dollars these days. Where's the trillions, or hundreds of billions worth in improved quality of life? What has gotten better other than the ability to produce more crap?
Comments like these make me feel like we're living in different worlds. I use LLMs multiple times a day and they've significantly improved my quality of life. They are also steadily becoming more useful over time (e.g. now solving math problems).
I don't know if its really improved my life at all. Sure I can put together quick and dirty single-use programs faster I guess, but I feel like losing that practice has actively made me a worse developer.
Re: Can the stockmarket swallow Anthropic, SpaceX and OpenAI?
#770Earlier quoted context omitted.
I do too, and pay $200/month, but anthropic’s margins on that revenue are negative. What’s the long term plan? Make it up on margin? 100% tariffs on Chinese open weight models? I don’t plan on pulling from my 401k for decades, so the long term plan is the part I care about.
Why would Anthropic margin's be negative? Inference is practically free for them, so what costs do they have for an additional subscription?
amortized training costs