Hacker News Reader

In what way do SPACs indicate we're in a bubble to you?

I don't disagree that we're in a bubble, but I don't understand much about SPACs and wonder what they indicate more precisely.

View on HN

IMO SPACs as an alternative to IPO are good for founders. I don't think they are good for markets because they indicate that investors don't currently care what their money is invested in, they just expect the manager to provide huge returns with very little due diligence. In this market it feels impossible to lose and SPACs have exploded because everyone is willing to write a blank check.

The argument I usually hear is that SPACs = speculation.

Most of the time investors are investing based on a rumor, and on top of that they are investing before they have access to the company's fundamentals/disclosures available after companies go public.

Lots of speculative energy is often considered an indication of a market bubble.

Reply on news.ycombinator.com