Latest news with #bubble
Yahoo
a day ago
- Sport
- Yahoo
76ers president Daryl Morey on Lakers' 2019-20 NBA title: 'It doesn't truly hold up as a genuine championship'
Philadelphia 76ers president of basketball operations Daryl Morey is a well-respected executive around the league. He's won everywhere he's been, though he's still looking for that first NBA championship. Because of that, Morey could catch some flack for downplaying what the Los Angeles Lakers were able to accomplish during the 2019-20 NBA season. With the season severely impacted thanks to the COVID-19 pandemic, teams had to play in a bubble down the stretch and into the playoffs. When the dust settled, the Lakers overcame those restraints, winning the team's first title in a decade. And it's only title, so far, with superstar LeBron James. But Morey — and others around the league — don't see it that way. Morey said he and many others don't consider the Lakers' 2019-20 title a "genuine championship," according to The Athletic. "Had the Rockets won the title, I absolutely would have celebrated it as legitimate, knowing the immense effort and resilience required. Yet, everyone I speak to around the league privately agrees that it doesn't truly hold up as a genuine championship. Perhaps the lasting legacy of the NBA bubble is that the NBA should be proud of its leadership at both the beginning and end of the pandemic, even though the champion will forever be marked by an asterisk." It's a bold claim, one that is certain to get Morey a ton of hate. Despite that, he still went on the record to call out the Lakers, and imply that many others around the NBA don't respect that title. If Morey is correct and many others share that sentiment, no one else is coming forward to share those thoughts. Every other person who answered a question about the legitimacy of the Lakers' championship in The Athletic's piece argued it's a valid title, though none of those answers came from NBA executives. It's unclear why the Lakers' 2019-20 NBA title is downplayed. Given the circumstances surrounding the pandemic, there's an argument to be made it was one of the toughest championships in league history. That's the track journalists Tim Reynolds and Kyle Goon took in The Athletic's piece. But Joe Vardon, the author of the article, provided one factor that may have helped the Lakers in the bubble. Vardon mentioned that the teams in the bubble didn't have to travel, and that may have given the Lakers, who were a veteran squad, an advantage over other teams. Maybe that was the difference for the James-led squad, though every other team played under the exact same circumstances. Regardless of how others around the league feel, there's not much to be done. The NBA was applauded in Vardon's piece for the way it handled the bubble, and isn't going to come out an invalidate a championship. As far as the league is concerned, the Lakers are the champions of the very legitimate 2019-20 NBA season. Anyone claiming otherwise comes off looking like a sore loser.
New York Times
2 days ago
- Entertainment
- New York Times
The NBA bubble, 5 years later: ‘The most exclusive basketball camp in world history'
It's been more than five years since the first people arrived at Disney World for the NBA bubble. Wednesday marks the anniversary of the first games played there, and the Los Angeles Lakers were crowned champions at the iconic amusement park in October 2020. To mark the occasion, I reached out to a few of the players, coaches, NBA executives and journalists who lived the experience as I did. These are our stories. Whether it was LeBron James, the world's most famous basketball player, or Malinda Adams, super producer for ESPN who does her work behind the camera, for the most part, the rules and conditions were the same. There were differences, of course, but we all were subjected to the same COVID-19 testing and safety protocols and had to stay inside the walls at Disney. Advertisement Adam Silver, NBA commissioner: I am proud of how the entire NBA community came together to pull off something that had never been done before. Looking back at the bubble — a name I resisted at the time — I marvel once again at sports' unique ability to galvanize people and inspire creativity and innovation, especially during challenging times. Mike Breen, play-by-play, ESPN and ABC: The league had their job to do, the media, the players, the coaches, and the referees, too, but there was a bond there that, 'Hey, listen, this is a difficult time. This is not the norm. We're all in uncharted waters, but we're all in it together.' Jordi Fernández, assistant coach, Denver Nuggets (now head coach, Brooklyn Nets): Going into the bubble, at least you felt like you were entertaining people. You were the only live show in the world. Ben Golliver, journalist, Washington Post (and author of 'Bubble Ball,' a book about our time at Disney): Adam Silver's 'collaborative' approach to being commissioner really paid dividends in 2020, and the bubble should be remembered as one of the signature moments of his tenure. Without a strong working relationship between the NBA and the National Basketball Players Association, the bubble could have popped before it got off the ground or as soon as the players came to terms with being physically trapped in Disney World. Billions of dollars were at stake, and the two sides pulled off the endeavor despite many complications. Kyle Goon, journalist, Orange County Register (now columnist for the Baltimore Banner): It's strange that we created a metaphorical safety net so people could play basketball. But it also was one of the last times I remember when people universally respected COVID as a vital threat. Sam Amick, journalist, The Athletic: Once I got past that first week of quarantine, which included a near-ejection for breaking COVID protocols (drinking wine with front-office executives outside of our respective rooms was a no-no), it was honestly a whole lot of fun. We got to watch high-level NBA playoff action up close with a few dozen other media members every night, then type our tales while working at the lakeside office inside the resort where we stayed. Rest, rinse and repeat — with a whole lot of pickleball played with the NBA officials in between. Advertisement Tim Reynolds, journalist, The Associated Press: If you survived the bubble, you proved your mettle. It was three months away at the most exclusive basketball camp in world history. All we did in there was watch, talk, think, eat, drink and sleep ball. No family, just the fellow residents and games. We watched the world stop while we kept going. It was hard. It was too hard, sometimes. I wanted to go home. Daryl Morey, general manager, Houston Rockets (now president of basketball operations, Philadelphia 76ers): A strange combination of The Colosseum for fans outside the bubble and a luxury purgatory for those of us within it. Outside, audiences were entertained by competition in isolation. Inside, players and executives battled opponents and the mental challenge of not being able to leave. Marc Spears, journalist and Naismith Hall of Fame inductee, Andscape: The accommodations for the media were mediocre, as we were actually staying in a motel (Oh, it wasn't THAT bad — Vardon), which made it hilarious to me that the players were complaining about being in four- and five- star accommodations with the ability to bring a loved one (later during the playoffs). They also had their own chefs and commandeered a few restaurants that media couldn't go to. To mentally survive, I made my accommodations fit as best as possible for me with things that were important to bringing me joy daily. I had a wine fridge stocked, I had a toaster oven to warm my food, I made my own coffee every day with very good bottled water and I had a speaker for my music. Some referees would come get my coffee. Adams, ESPN producer: We did 10 days of quarantine (most only served seven days in quarantine, but Adams and Malika Andrews were there before the players), which was the WORST part of it to me. We only left our room for daily testing and then right back in. We couldn't even keep our doors open. I did a 5K in my room daily, and I brought my bands and weights from home, thank goodness. We took COVID tests daily, for 108 days straight, and had to follow strict protocols. We also got to test new technology like ŌURA rings and KINEXON tracking and tracing devices. So, it was really exciting to be on the front lines of that. In my opinion, we proved that following protocols works. No one got COVID. Marc Stein, journalist, New York Times (now publishing on Substack): Five years later, honestly, I would use the same word that I used frequently back then: unmissable. As soon as we started hearing about it, I viewed the bubble as a had-to-be-there assignment, and I'm so grateful in retrospect that I was a resident of the NBA's first-of-its-kind village for 50-something days … even though I can also admit that I'm not in a real rush to deal with all those rules, regulations and restrictions again. I'm not sure we'll ever see the whole league (or two-thirds of it) congregated in one place again to build up to an NBA Finals that takes place in, uh, October. Advertisement Adams: I asked to go. I wanted to work and be a part of history. Vardon: So did I. Kyle Korver, guard, Milwaukee Bucks (now assistant general manager, Atlanta Hawks): I think the legacy is tied around like, humans can figure things out. In part because there were no fans, and in part because NBA teams and media don't typically live together, perhaps never before have reporters gotten quite as close a look at the players they cover as during the bubble. Breen: Even without the fans, how hard the players played, how intense those games were, just goes to show you how much they crave and love the competition. I mean, there's nobody there cheering them on. Some of these guys make these spectacular plays, and there's no crowd roar. It was odd, but it had zero impact on the player's intensity, and that wasn't easy. Fernández: I thought that some of those games were really cool. We got to two Game 7s, and we came back from a 3-1 deficit (against the Utah Jazz). So, for us, it was very special. And we didn't have enough with the Lakers (in the conference finals). They were very good, ended up winning. But I thought the guys were impressive. Jamal (Murray), Nikola Jokić, the whole group. Spears: What doesn't get talked about enough about the bubble was how amazing the basketball was there. It was truly basketball heaven. We basically were at an AAU tournament that included NBA players. It was absolutely incredible. There were three gyms next to each other, and games being played in two of them. I will never forget seeing Game 1 of the Eastern Conference finals and then walking 15 yards to a gym to watch one of the craziest games ever in Game 7 between the underachieving Clippers and the Nuggets. Keep in mind that the media was able to sit close to the floor for games just like it was in the earlier part of my career. Advertisement Vardon: There were a bunch of tables outside the Gran Destino Tower at Coronado Springs, where the teams stayed. I was throwing a party for my fellow media members, and we had boxes of pizza and endless bottles of wine assembled. We were eating and drinking at dusk when, on a bicycle, wearing a helmet, LeBron James pulled up. 'Hey, LeBron,' I shouted to the noted wine connoisseur and fellow Akron, Ohio, native, 'Come have a drink with us.' 'Y'all got any tequila?' he countered. A little perplexed and on my heels, I said no, but we had plenty of wine, and good red at that, and added something to the effect of 'When would we have a chance to have a drink like this?' He wasn't moved, declared he was looking for tequila and rode his bike back toward the hotel – the doors opened automatically, and he pedaled through the carpeted hallway. … I also remember seemingly dozens of players, few if any of them playing for the LA Clippers, gathering around then-Clippers assistant Tyronn Lue to talk and laugh and listen on those same outdoor tables, and then-Nuggets coach Michael Malone, before the Nuggets' first game, putting name tags on the bench for each player to sit, socially distanced, with his own dedicated water bottle. The summer of 2020 would have been a tumultuous time in the United States even without a pandemic. The murder of George Floyd sparked protests across the country, and in the bubble, almost all the players knelt during the national anthems to protest police brutality and racial injustice. The season almost stopped again, and for good, when the Bucks forfeited a playoff game against the Orlando Magic in protest of the shooting of Jacob Blake in suburban Milwaukee. Amick: The country was on edge. Korver: The cultural issues, the George Floyd movement, Black Lives Matter movement, people feel quite a bit differently today than people were feeling about that during that time. There's been a shift in the culture in the country, an unfortunate shift, in my opinion, just where we're trying to move collectively or where many people are trying to move collectively. I think the NBA tried to empower the players to use their voice and to use the platform that they have. Those are challenging issues to have a strong voice in. I think it's a huge credit to the league for standing with, and again, trying to empower players to use their voice and to stand for issues that matter to them, to us, important issues. Golliver: In hindsight, that experience, which included the Milwaukee Bucks' decision to protest a police shooting by refusing to take the court, now feels like an inflection point. The NBA garnered praise and prompted backlash for its players' activism, and the league returned to a less polarizing reality for its 2020-21 season. The national anthem kneeling, jersey slogans and 'Black Lives Matter' signs are now a distant memory, and most star players kept a lower profile politically during the 2024 presidential election. Vardon: I nearly missed one of the biggest stories in NBA history. I had decided to take a nap and skip that Bucks-Magic game, because Milwaukee was up 3-0 in the series and the Lakers were playing later — they were appointment viewing. But I couldn't sleep and hopped the last bus to the Wide World of Sports Complex to catch the Bucks and Magic, who were supposed to be the first game of the day. Within minutes of arrival, I was standing outside the Bucks' locker room, reporting from my phone in real time as the players holed themselves up in there, refusing to come out. We could hear the Bucks through the walls, on the phone with the Wisconsin lieutenant governor. Korver: Playing that game that day didn't matter the most. And I think there's going to need to be more time before you really create a legacy of that moment. I don't know that there's been enough time. But again, I think it just goes back to the league being brave and being willing to speak out and stand up. And players have each other's back. I think it started off in our locker room, where we had a couple of players who felt like it wasn't the right decision (to play that day), and the rest of the locker room had their back. And then a team decides not to play, and the other players in the league had that team's back. And I just think that's the legacy of a true brotherhood. Advertisement Stein: I'm not sure I'll ever cover anything like the Bucks' playoff walkout and the powerful aftermath again. Vardon: With the fate of the bubble hanging in the balance that night, all of us who were there will remember the players from Eastern European countries, including superstars like Luka Dončić and Nikola Jokić, gathered at the island restaurant in the middle of a lake on the Coronado Springs property, singing together at the top of their lungs. I suppose any discussion of the bubble must include the, what's the word, legitimacy of the Lakers' championship? I promise I'll weigh in. Morey: Had the Rockets won the title, I absolutely would have celebrated it as legitimate, knowing the immense effort and resilience required. Yet, everyone I speak to around the league privately agrees that it doesn't truly hold up as a genuine championship. Perhaps the lasting legacy of the NBA bubble is that the NBA should be proud of its leadership at both the beginning and end of the pandemic, even though the champion will forever be marked by an asterisk. Goon: There should never be an asterisk to go with the Lakers' championship. That title, and everything about the bubble, was hard as hell. Reynolds: It's funny how the word 'bubble' has a different meaning now. The Lakers were bubble champions. Lakers-Heat was the bubble finals. These are not disrespectful terms. … Some say the Lakers won a watered-down title. I say they won the toughest one to win in NBA history. Amick: And yes, for the record, I believe the Lakers' bubble title truly counts as much, if not more, than any other. Vardon: Everyone played by the same rules, and the Lakers were a great team that year anyway. While I echo what my colleagues say about the difficulty of winning the bubble playoffs, I do have a 'Yeah, but…' One of the hard parts of the postseason is the air travel — especially on older players because of their recovery times. LeBron took one flight in three months, and I don't know what to do with that. Everyone in the Lakers played against in the bubble had the same set of circumstances, but when comparing the 2020 champs to preceding and succeeding champions, the Lakers and their aging vets didn't have to play a game, get on an airplane and play another game within 48 hours. There were, of course, no fans at these games. When families were allowed in, toward the end, they were seated, albeit socially distanced, in the stands, and other teams and league officials could sit and watch. The league tried something different — putting up a huge video board along the edge of the court and streaming in fans who were watching at home. Advertisement Breen: Somebody wrote a line that I thought was brilliant, that fans are the oxygen of pro sports. And I thought that was just perfect. … Not having the fans there and the reaction of going crazy or booing or being shocked — there was an element that was really missing, and without them there, your appreciation of what they bring and their passion that they have and how they motivate players, having motivated announcers, coaches, referees. Really, to me, that was something that I thought was wonderful for us to realize and appreciate just how important the fans were. Spears: The fake crowd noise was terrible, but to be in a gym of 100 people watching the NBA Finals was one of the most amazing moments of my career and life. It's something barring crazy I will never experience again. The 'bubble' was a success by almost any measure. There were zero cases of COVID among the 700 NBA players and team staff who were there. Vendors working inside the bubble did get sick — 24 cases of COVID-19 identified among non-team personnel — but there was no forward transmission to campus residents. The league regularly shared its protocols, best practices and findings with the CDC, FDA and Tokyo Olympics, and no fewer than 10 scientific journals documented what the science and medical communities learned from what the NBA pulled off. No playoff games were canceled, and a champion was crowned, which meant there was no violation of the league's multibillion-dollar TV contract. And yet, the experience felt so … difficult. The isolation. Time away from home. The social movements. Challenging food. Florida weather in July and August. Bonkers air conditioning. Which is why takeaways from our time there are always so mixed. Fernández: My son was 9 months old when I left. He was 9 months old. And when I came back, he was a little over 1, so I missed his first birthday. I was kind of sad. I remember we were playing Utah, Game 7. And if we win, we get to stay. And if I lose, I get to go to my son's birthday. … I would never want to go through that again. Also, I'm glad I did it because it was, you know, I can always say that I was there. Adams: As I look back, being in the NBA bubble is the hardest thing I have ever done mentally, emotionally and physically. It tested me, but I am so glad I did it. Once I found a rhythm, I got my footing. I found a way to fit in my workouts early in the morning. Working out is my mental health. I found community in the other journalists. We were all experiencing the same things: Isolation, being away from our families, eating food we didn't prepare and being in confined spaces. … I can honestly say, when I see people that were in the bubble with me, I smile bigger, and I hug them harder. It was an experience I will never forget and cherish. An example of the NBA bubble love, I celebrated my 60th birthday in the bubble. They threw me a big surprise birthday party. I was shocked and speechless. I was overwhelmed with emotion and cried many times during the evening. The bubble love is real. Reynolds: The legacy of the bubble has so many layers now. Unless you were there, you still don't — and can't — understand what it was like. It worked. The NBA pulled it off. The season was saved. The outside world had the escape it desperately needed from fear and uncertainty and anger and boredom and everything else that came with the lockdown days. Would I do it again? God, I hope not. But I'm proud to say that I was there and was one of the few who covered a season like none other. We all went through hell but were very lucky to have that privilege. Goon: The mental trial to finish an already-trying season was something that folks who didn't experience it have never fully appreciated. Advertisement Stein: The bubble was historic and invigorating and taxing all at once. You just had to be there if you were lucky enough to get an invite. Spears: I was able to be in a room that only a select few people could say they ever entered. And I will forever cherish having had that assignment. Vardon: At the outset of my trip five years ago, in a story, I called the bubble 'the last, great American sports writing assignment' — which, sue me, may have been a bit hyperbolic at the time. But at the end of it, I wrote it was 'the assignment of a lifetime,' which was, and remains, correct. We, as a country and even as an industry, rebounded from that hot summer. Life returned. Fans came back. I've been to two Olympics, to Paris three times, to the Middle East and Mexico twice, to Southeast Asia, Spain and London, all on assignment. But the 54 days I spent at Disney World, how I feel about them is captured here, by all the people who were kind enough to share their thoughts. It's strange — of the 22 teams in the bubble, only one head coach is still with the team he coached there (Erik Spoelstra with Miami, though Lue was an assistant with the Clippers then). It's a sign of how fast and often things change in the NBA. And yet, when 10 years have passed since the bubble, the memories republished here, and the ones still in my head, will still be there. (Top photo of Disney's Coronado Springs Resort: Joe Murphy / NBAE via Getty Images)
Globe and Mail
5 days ago
- Business
- Globe and Mail
Could a Quantum Computing Bubble Be About to Pop? History Offers a Clear Answer
Key Points IonQ, Rigetti Computing, D-Wave Quantum, and Quantum Computing have reached valuation levels well beyond those seen during prior stock market bubbles. Each of these companies has recently raised capital through a series of equity offerings and stock issuances. These moves could suggest that the valuation levels for these businesses are not only abnormally high, but unsustainable. These 10 stocks could mint the next wave of millionaires › Last summer, companies such as IonQ (NYSE: IONQ), Rigetti Computing (NASDAQ: RGTI), D-Wave Quantum (NYSE: QBTS), and Quantum Computing (NASDAQ: QUBT) were unknown penny stocks. However, as quantum computing steadily made its way toward center stage in the artificial intelligence (AI) realm, each of these companies witnessed meteoric rises in their share prices. Over the last 12 months, IonQ stock has blasted higher by 517%, while Rigetti, D-Wave, and Quantum Computing have experienced surges of at least 1,500% as of this writing (July 21). With valuations reaching historically high levels, could investors be on the verge of witnessing a quantum computing bubble bursting? Is quantum computing in a bubble? The chart below illustrates valuation trends among popular quantum computing stocks on a price-to-sales (P/S) basis. IONQ PS Ratio data by YCharts. As I outlined in a prior article, the quantum computing stocks above are trading at far higher P/S multiples compared to levels seen during the dot-com and COVID-19 stock bubbles. For example, during the internet boom in the late 1990s, stocks such as Amazon, Cisco, and Microsoft experienced peak P/S ratios in the range of 30x and 40x. Taking this a step further, popular COVID stocks such as Zoom Communications and Peloton saw P/S multiples top out at 124x and 20x, respectively. The big theme here is that IonQ, Rigetti, D-Wave, and Quantum Computing are each trading for valuation multiples that could be seen as historically high, even when compared to prior bubble events. With that said, other AI companies that are also exploring quantum computing -- such as Nvidia, Amazon, Alphabet, and Microsoft -- currently trade for much more reasonable valuation multiples when compared to the companies in the chart above. For this reason, I do not think the entire quantum computing landscape is at risk of experiencing a bubble-bursting event. However, IonQ and its peers have been dropping some breadcrumbs in recent months that lead me to think the smaller quantum computing players could be on the verge of a harsh sell-off. What's going on under the hood with quantum computing stocks? After some digging into certain filings with the Securities and Exchange Commission (SEC), I think IonQ, Rigetti, D-Wave, and Quantum Computing may be trying to signal some important things to investors: In February, IonQ announced that it planned to raise up to $500 million through a series of stock issuances. The company doubled down on its capital-raising ambitions more recently, offering 14,165,708 shares at a price of $55.49 -- raising nearly $1 billion in the process. In June, Rigetti raised $350 million in capital after completing an at-the-market (ATM) equity offering. Between June 11 and June 27, D-Wave Quantum raised $400 million through an ATM offering. Of note: This followed a prior raise of $150 million that occurred in January. In late June, Quantum Computing raised $200 million following the issuance of 14 million shares at an average price of $14.25. What's really going on here? With each of these quantum computing stocks trading near all-time highs, it appears to me that management is looking to take advantage of frothy market conditions. IONQ data by YCharts. Quantum computing is a research-heavy, capital-intensive industry. Management at IonQ and its peers surely understand this, and so I see these capital raises as a calculated move to capitalize on inflated, overstretched valuations. Should you invest in quantum computing stocks? To me, any hint of a bubble surrounding IonQ and its smaller peers may already be in the process of bursting. Under the surface, the various stock issuances and equity offerings annotated above could suggest that management does not believe current price levels are sustainable. By using the dot-com and COVID bubbles as benchmarks, history would suggest that a major correction could be on the horizon for these small quantum computing stocks. Issuing stock to raise funds is not sustainable in the long run. Furthermore, consistently diluting shareholders through these offerings could call into question how these companies are allocating capital. In my eyes, if investors are seeking exposure to the quantum computing industry, they are best off exploring more diversified opportunities in big tech as opposed to the smaller, more speculative players analyzed in this piece. Where to invest $1,000 right now When our analyst team has a stock tip, it can pay to listen. After all, Stock Advisor's total average return is 1,041%* — a market-crushing outperformance compared to 183% for the S&P 500. They just revealed what they believe are the 10 best stocks for investors to buy right now, available when you join Stock Advisor. See the stocks » *Stock Advisor returns as of July 21, 2025
Yahoo
5 days ago
- Business
- Yahoo
Could a Quantum Computing Bubble Be About to Pop? History Offers a Clear Answer
Key Points IonQ, Rigetti Computing, D-Wave Quantum, and Quantum Computing have reached valuation levels well beyond those seen during prior stock market bubbles. Each of these companies has recently raised capital through a series of equity offerings and stock issuances. These moves could suggest that the valuation levels for these businesses are not only abnormally high, but unsustainable. These 10 stocks could mint the next wave of millionaires › Last summer, companies such as IonQ (NYSE: IONQ), Rigetti Computing (NASDAQ: RGTI), D-Wave Quantum (NYSE: QBTS), and Quantum Computing (NASDAQ: QUBT) were unknown penny stocks. However, as quantum computing steadily made its way toward center stage in the artificial intelligence (AI) realm, each of these companies witnessed meteoric rises in their share prices. Over the last 12 months, IonQ stock has blasted higher by 517%, while Rigetti, D-Wave, and Quantum Computing have experienced surges of at least 1,500% as of this writing (July 21). With valuations reaching historically high levels, could investors be on the verge of witnessing a quantum computing bubble bursting? Is quantum computing in a bubble? The chart below illustrates valuation trends among popular quantum computing stocks on a price-to-sales (P/S) basis. As I outlined in a prior article, the quantum computing stocks above are trading at far higher P/S multiples compared to levels seen during the dot-com and COVID-19 stock bubbles. For example, during the internet boom in the late 1990s, stocks such as Amazon, Cisco, and Microsoft experienced peak P/S ratios in the range of 30x and 40x. Taking this a step further, popular COVID stocks such as Zoom Communications and Peloton saw P/S multiples top out at 124x and 20x, respectively. The big theme here is that IonQ, Rigetti, D-Wave, and Quantum Computing are each trading for valuation multiples that could be seen as historically high, even when compared to prior bubble events. With that said, other AI companies that are also exploring quantum computing -- such as Nvidia, Amazon, Alphabet, and Microsoft -- currently trade for much more reasonable valuation multiples when compared to the companies in the chart above. For this reason, I do not think the entire quantum computing landscape is at risk of experiencing a bubble-bursting event. However, IonQ and its peers have been dropping some breadcrumbs in recent months that lead me to think the smaller quantum computing players could be on the verge of a harsh sell-off. What's going on under the hood with quantum computing stocks? After some digging into certain filings with the Securities and Exchange Commission (SEC), I think IonQ, Rigetti, D-Wave, and Quantum Computing may be trying to signal some important things to investors: In February, IonQ announced that it planned to raise up to $500 million through a series of stock issuances. The company doubled down on its capital-raising ambitions more recently, offering 14,165,708 shares at a price of $55.49 -- raising nearly $1 billion in the process. In June, Rigetti raised $350 million in capital after completing an at-the-market (ATM) equity offering. Between June 11 and June 27, D-Wave Quantum raised $400 million through an ATM offering. Of note: This followed a prior raise of $150 million that occurred in January. In late June, Quantum Computing raised $200 million following the issuance of 14 million shares at an average price of $14.25. What's really going on here? With each of these quantum computing stocks trading near all-time highs, it appears to me that management is looking to take advantage of frothy market conditions. Quantum computing is a research-heavy, capital-intensive industry. Management at IonQ and its peers surely understand this, and so I see these capital raises as a calculated move to capitalize on inflated, overstretched valuations. Should you invest in quantum computing stocks? To me, any hint of a bubble surrounding IonQ and its smaller peers may already be in the process of bursting. Under the surface, the various stock issuances and equity offerings annotated above could suggest that management does not believe current price levels are sustainable. By using the dot-com and COVID bubbles as benchmarks, history would suggest that a major correction could be on the horizon for these small quantum computing stocks. Issuing stock to raise funds is not sustainable in the long run. Furthermore, consistently diluting shareholders through these offerings could call into question how these companies are allocating capital. In my eyes, if investors are seeking exposure to the quantum computing industry, they are best off exploring more diversified opportunities in big tech as opposed to the smaller, more speculative players analyzed in this piece. Trump's Tariffs Could Create $1.5 Trillion AI Gold Rush The Motley Fool's analysts are tracking a massive shift in U.S. tech. Over $1.5 trillion is already flowing into infrastructure, AI, and advanced manufacturing… and the number keeps climbing. Following a major tariff policy shift, a new AI Gold Rush is taking shape, and we think . It builds the tech infrastructure that Apple, OpenAI, and others suddenly can't live without. We just released a full write-up on this under-the-radar stock — and why now might be the exact moment to move. Continue » *Stock Advisor returns as of July 21, 2025 Adam Spatacco has positions in Alphabet, Amazon, Microsoft, and Nvidia. The Motley Fool has positions in and recommends Alphabet, Amazon, Cisco Systems, Microsoft, Nvidia, Peloton Interactive, and Zoom Communications. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy. Could a Quantum Computing Bubble Be About to Pop? History Offers a Clear Answer was originally published by The Motley Fool
Yahoo
22-07-2025
- Business
- Yahoo
Trading Day: Tech cools, Trump's Fed ire burns
By Jamie McGeever ORLANDO, Florida (Reuters) -TRADING DAY Making sense of the forces driving global markets By Jamie McGeever, Markets Columnist The rally in U.S. tech stocks lost steam on Tuesday while bond yields and the dollar fell, as investors trimmed positions ahead of the first 'Big Tech' earnings reports and digested U.S. President Donald Trump's latest tirade against Fed Chair Jerome Powell. More on that below. In my column today I look at the differences - and potentially worrying similarities - between today's AI frenzy and the dotcom boom and bust of 25 years ago. Is today's bubble bigger than it was back then? If you have more time to read, here are a few articles I recommend to help you make sense of what happened in markets today. 1. Fed reform may move markets more than Powell ouster:Mike Dolan 2. IN THE MARKET-How the ghost of 'transitory' inflation ishaunting the rate debate 3. Dollar's dive offsets tariff sting for some 4. Industrial pruning won't pull China out of deflation asquickly as last time 5. How Japan's election outcome muddles the BOJ's policypath Today's Key Market Moves * Nasdaq snaps a six-day winning streak, falling 0.4%. Inthe S&P 500 tech falls 1%, real estate and health each risenearly 2%. * Russell 2000 small caps index climbs 0.8%, Dow up 0.4%. * Hong Kong and Chinese stocks outperform globally, gaining0.5% and 0.8%, respectively. Europe falls, hit by German stocks'worst day in two months. * U.S. 10-year yield slips to two-week low of 4.328%, downfor a third day. * Dollar index also falls for a third day to a two-week low. * Gold up 1% to a five-week high of $3,433/oz, closing inon April's record $3,500/oz. Tech cools, Trump's Fed ire burns If investors cooled their stock-buying fervor on Tuesday, Trump showed no sign of relaxing the pressure he's heaping on Powell, branding the Fed chair a "numbskull" for not cutting interest rates. Financial markets may be getting inured to the attacks by now, but one wonders if Powell will be prepared to face another 10 months of them until his term as Fed Chair expires. With Powell in blackout period ahead of next week's Fed decision, investors are unlikely to hear from him until next Wednesday when he holds his scheduled post-meeting press conference. Powell has insisted he won't resign and that Trump does not have the legal authority to fire him, while the president doesn't appear to be in any mood to tone down his rhetoric against Powell or the Fed as an institution. The standoff is getting more tense. So much so, former PIMCO CEO and co-CIO Mohamed El-Erian posted on X that Powell should resign "to safeguard the Fed's operational autonomy," a far from ideal scenario but preferable to the growing and broadening threats to Fed independence which will "undoubtedly increase should he remain in office." Meanwhile, on trade, Treasury Secretary Scott Bessent said he will meet his Chinese counterpart next week in Stockholm to discuss extending an August 12 deadline for a deal to avert sharply higher tariffs. Trump said he may take up President Xi Jinping on his offer to visit "in the not-too-distant future". Washington announced a trade deal with the Philippines which will see imports from the South East Asian country slapped with 19% tariffs, while the U.S. will pay zero tariffs. Similar tariffs on imports from Indonesia were also announced. U.S.-Philippines and U.S.-Indonesia goods trade volumes last year were around $23.5 billion and $38.3 billion, respectively. The latest U.S. corporate earnings were a mixed bag, with Coca-Cola reporting strong profits and demand, while General Motors' net income slumped by a third as tariff costs took a $1.1 billion bite from its bottom line. Still, nearly 80% of the S&P 500 firms that have reported so far have beaten analyst expectations, according to LSEG data. Analysts' year-on-year aggregate earnings growth forecasts for the index now stand at 7.0%, up from 5.8% as of July 1. Attention on Wednesday rests squarely on Alphabet and Tesla, the first of the megacap tech firms to report. Is today's AI boom bigger than the dotcom bubble? Wall Street's concentration in the red-hot tech sector is, by some measures, greater than it has ever been, eclipsing levels hit during the 1990s dotcom bubble. But does this mean history is bound to repeat itself? The growing concentration in U.S. equities instantly brings to mind the internet and communications frenzy of the late 1990s. The tech-heavy Nasdaq peaked in March 2000 before cratering 65% over the following 12 months. And it didn't revisit its previous high for 14 years. It seems unlikely that we'll see a repeat of this today, right? Maybe. The market's reaction function appears to be different from what it was during the dotcom boom and bust. Just look at the current rebound from its post-'Liberation Day' tariff slump in early April – one of the fastest on record – or its rally during the pandemic. But despite all of these differences, there are also some worrying parallels. Investors would do well to keep both in mind. TOP 10 CLUB The most obvious similarity between these two periods is the concentration of tech and related industries in U.S. equity markets. The broad tech sector now accounts for 34% of the S&P 500's market cap, according to some data, exceeding the previous record of 33% set in March 2000. Of the top 10 companies by market capitalization today, eight are tech or communications behemoths. They include the so-called 'Magnificent 7' – Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia and Tesla – as well as Berkshire Hathaway and JPMorgan. By contrast, only five of the 10 biggest companies in 1999 were tech firms. The other five were General Electric, Citi, Exxon, Walmart, and Home Depot. On top of that, the top 10 companies' footprint in the S&P 500 today is much larger than it was back then. The combined market cap of the top 10 today is almost $22 trillion, or 40% of the index's total, significantly higher than the comparable 25% in 1999. This all reflects the fact that technology plays a much bigger role in the U.S. economy today than it did around the turn of the millennium. AI BUBBLE? By some measures, the current tech boom, driven in part by enthusiasm for artificial intelligence, is more extreme than the IT bubble of the late 1990s. As Torsten Slok, chief economist at Apollo Global Management, points out, the 12-month forward earnings valuation of today's top 10 stocks in the S&P 500 is higher than it was 25 years ago. However, it's worth remembering that the dotcom bubble was characterized by a frenzy of public offerings and a raft of companies with shares valued at triple-digit multiples of future earnings. That's not the case today. While the S&P tech sector is trading at 29.5 times forward earnings today, which is high by historical standards, this is nowhere near the peak of almost 50 times recorded in 2000. Similarly, the S&P 500 and Nasdaq are currently trading around 22 and 28.5 times forward earnings, compared with the dotcom peaks of 24.5 and over 70 times, respectively. $3 TRILLION INVESTMENT HURDLE With all that being said, a meaningful, prolonged market correction cannot be ruled out, especially if AI-driven growth isn't delivered as quickly as investors expect. AI, the new driver of technological development, will require vast capital outlays, especially on data centers, which may mean that earnings and share price growth in tech could slow in the short run. According to Morgan Stanley, the transformative potential of generative AI will require roughly $2.9 trillion of global data center spending through 2028, comprising $1.6 trillion on hardware like chips and servers and $1.3 trillion on infrastructure. That means investment needs of over $900 billion in 2028, they reckon. For context, combined capital expenditure by all S&P 500 companies last year was around $950 billion. Wall Street analysts are well aware of these figures, which suggests that at least some percentage of these huge sums should be factored into current share prices and expected earnings, but what if the benefits of AI take longer to deliver? Or what if an upstart (remember China's DeepSeek) dramatically shifts growth expectations for a major component of the index, like $4-trillion chipmaker Nvidia? Of course, technology is so fundamental to today's society and economy that it's difficult to imagine its market footprint shrinking too much, for too long, as this raises the inevitable question of where investor capital would go. It's therefore reasonable to question whether a tech crash today would take well over a decade to recover from. But, on the other hand, it's that type of thinking that has gotten investors into trouble before. What could move markets tomorrow? * Bank of Japan Deputy Governor Shinichi Uchida speaks * Taiwan industrial production (June) * U.S. existing home sales (June) * U.S. Treasury auctions $13 billion of 20-year bonds * U.S. Q2 earnings, including Alphabet, Tesla, IBM, AT&T Want to receive Trading Day in your inbox every weekday morning? Sign up for my newsletter here. Opinions expressed are those of the author. They do not reflect the views of Reuters News, which, under the Trust Principles, is committed to integrity, independence, and freedom from bias. (By Jamie McGeever; Editing by Nia Williams) Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
