It is incredible how vicious the wave of selling is in the cloud kings. It's almost as if altogether the growth stock managers have decided that the cloud has slowed, inflation erodes their value, and the stocks are more dependent upon the economy than people realized.
Periodically we have gotten these selling squalls. Usually they occur because of an earnings shortfall or because there have been too many equity offerings.
The former is just untrue. The latter? Arguably we have seen a bunch of cloud offerings but none that would merit such huge sell-offs like today.
What do I think is going on? We are beginning to have gigantic sell programs related to ETFs that can't be controlled. That said, I know for Action Alerts PLUS we wish we could do some buying because the losses are so great that you know there is opportunity. I know there is inflation in the system. PPG Industries (PPG) just said it was going to raise the price of paint by 10% because of "unprecedented pressures in raw materials, freight, distribution and labor across every region," according to Senior Vice President Rebecca Liebert. (Thank you Matt Horween for passing that tidbit on.)
But that's not what's causing the cloud kings to come down. This is just a vicious rotation that can't be stopped until everyone's done selling which is, again, why I don't like this market although this decline seems more buyable because of its extremes.