Investing
Baidu & Overinflated Bubble Pricing Lessons (BIDU, RIMM, GOOG, AMZN)
Published:
Baidu.com (NASDAQ:BIDU) is showing how vulnerable overinflated shares are when even a hint of bad news or "Less Good" news comes out. A report out of JPMorgan deemed somewhat cautious is the culprit. Now Baidu’s shares are DOWN OVER $50.00 FROM INTRADAY HIGHS. These bubble stocks can rally and rally beyond what the valuations or fundamentals will merit. If you were a trader in 1998 to 2000 you know that. But when the air comes out it is one massive rush. The NASDAQ was over 2,820 earlier, but now it is at 2,775 and the air is out at least for part of the day.
The Chinese stocks have made the endless runs like this before, only to give back huge percentages of losses. VMWare (NYSE:VMW) is not Chinese, but it was making the same sort of gains. VMware shares are now down over 5% and are down almost $14.00 from intraday highs. Google (NASDAQ:GOOG) is also down $20.00 from its intraday highs. Research-in-Motion (NASDAQ:RIMM) is now down some 8% on the day and down over $10.00 from intraday highs. Amazon.com (NASDAQ:AMZN) shares are down 6% on the day. The list goes on and on.
The truth is that these stocks can swing back too. But the lessons of the bubble every few years or so seem to get forgotten before the reminder of what can happen shows itself. Sometimes the selling pressure is just profit taking, and sometimes it’s just selling because everyone else is selling.
Jon C. Ogg
October 11, 2007
Let’s face it: If your money is just sitting in a checking account, you’re losing value every single day. With most checking accounts offering little to no interest, the cash you worked so hard to save is gradually being eroded by inflation.
However, by moving that money into a high-yield savings account, you can put your cash to work, growing steadily with little to no effort on your part. In just a few clicks, you can set up a high-yield savings account and start earning interest immediately.
There are plenty of reputable banks and online platforms that offer competitive rates, and many of them come with zero fees and no minimum balance requirements. Click here to see if you’re earning the best possible rate on your money!
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.