..... and Apple stock will fall to a reasonable $10/share.
We are seeing a market expansion. It is sudden, and has aspects of a bubble, but ultimately the rules have changed and China now needs lots and lots of domains.
Don't get me wrong, I can't imagine how someone could profit on a buy-out of LLLL.link CHIPs. But the landscape has shifted and "premium" is a lot wider.
actually that was what exactly happened to Apple stock and many others of the dot-com hype, after the dot-com hype...
what you and we all do is extrapolate linearly because it is that way our mind is wired and that is our experience on the very long run. however, we need to put things in perspective.
not every bet will win, that is, not every short domain will make money, much less if we keep expanding what is a short domain. is a LLLLL.com a short domain with a 12 million combos? i don't think so. at least not for now and not for awhile.
we need also to consider buyer's base expansion, that is, users online and domainers. this base has expanded greatly, but the most increase came from the domainer's base. this is not sound fundamentals. this is indication of euphoria. we will need to have an over run on the user's base or a continuous increase in the domainer's base.
users will not step into this wagon on current prices. domainers ARE making the market, mostly from China. and at this phase, over the last two years, we can see a growth in the domainer's base and commitment of money. two things that are not elastic. at some point it will reverse and will reverse hard. when/where is that point? well, we can get an hint looking into the price curve and market sentiment. and they are both exploding on top of a run of 6 years.
of course it is not reasonable to foresee LL.com get to low 5 figures again. corrections after bubbles tend to retrace at least 70%-90% of a market, but price of LL.com had gone up over the last 20 years so they have gotten a base to support them into higher levels. that does not happen with LLLL.com, neither NNNNN.com neither any combo of a bigger dimension. not even LLL.com has got to a price level that can sustain it's value above high 4 figures in face of a major recession...
there is no rocket science into this. the problem is we think linearly and we are on a situation that is exponential. what now seems impossible can soon be very real.
another very important point that we need not to forget is that we can safely assume that the domainer's base and user's base will increase over the long run (there are many more people in the world to come the internet, and more domainers to enter the market) but *market conditions* can change drastically, mainly, the price of money.
we have several indications that we are on a global deflation. the only (important) thing that is keeping the status quo is the stock and bond market which tend to spread the wealth effect onto other markets (domains including). if we do not have inflation and an expanding environment then prices can be kept lower for many years. by lower I mean, much lower than current prices. this may seem unreasonable to think at the moment because we can only think that domains will go up in value. but that is our *current* view of things, deformed by an extended period of strong gains and our linear reasoning.
