I continue to be more than a little frustrated at continued high valuations of the tech stocks, the NASDAQ 100 to be specific. Amazon included in operating earnings the sale of a subsidiary in Europe, and is now trading up 15%. This is a retailer, looking into a recession, and already trading at a P/E around 70. Added to which, forecasting a sharp reduction in gross margins in the coming quarter.

But the mechanical monkeys jam it up anyway. Because they can, I guess. Bill Fleckenstein calls this kind of action “muscle memory,” just unthinking reflex left over from the bubble eras. Personally, I think of it as the actions of black box traders, just mechanical monkeys doing the same thing over and over, without understanding.