The tech community might soon find itself under siege by protesters demanding redistribution of wealth.
Who could forget the Occupy Wall Street movement that gripped America’s finical industry in 2011? That scene could repeat itself soon but concentrated specifically in Silicon Valley, according to reports.
The Occupy Wall Street movement started in New York City’s Zuccotti Park and featured a shanty town of protesters who were upset over the 2008 Wall Street crash and lack of action taken by the Federal Government against those individuals and companies the protesters deemed responsible for the crash.
According to a report released by Bank of America Merrill Lynch’s chief investment strategist, Michael Hartnett, Silicon Valley could soon find itself facing a populist uprising similar to the one the finical industry faced in 2011.
The tech stock rally “could ultimately lead to populist calls for redistribution of the increasingly concentrated wealth of Silicon Valley,” Hartnett reports.
The report implies that today, “more and more people feel left behind economically despite the massive expansion of global business, especially for digital technology firms.”
The CNBC article cited how the “big tech stocks have accounted for 40 percent of the S&P 500’s run to record highs this year, according to Goldman Sachs.”
BofAML’s Hartnett estimates if the S&P 500 hits 2,630, the ratio of global market cap to global GDP will exceed all-time highs hit in 1999 and 2007, both times just before major market collapses.
The disconnect between an S&P 500 led by technology and the global economy “is ultimately unsustainable,” Hartnett said. Against the forces of economic nationalism, he recommends investing in resources, banks, the euro zone and gold.
The parallels between the tech community and financial industry that Hartnett’s lays out make a compelling case that tech companies might soon find the Occupy movement at their doorstep
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