[sgpl]

I'm pretty bearish on SPACs tbh. Not in the immediate future but 2-3 years out (most of 2021 will be spent on vaccines so I'm sure there will be more stimulus added to the economy).

It's just bonkers that there's so many companies that you can take public with this mechanism without more than a handful being duds so it just seems like market participants who are able to launch SPACs are doing so to take advantage of the mkt conditions to cash out. Also, there are no incentives to keep the SPAC promoters as long term shareholders so they really don't have any reason to not dump their shares after a little bit of time unless they see that these companies will have sustained growth. So to me (with a few exceptions) this seems like a massive pump and dump scheme but with more sophisticated players.

I had initially assumed that there was only a little bit of extra cash floating around in the US on the account of the two stimulus bills passed but I recently read in an article on Bloomberg that the US Govt/Fed bought something in the neighbourhood of $5 TRILLION worth of corporate bonds in 2020 alone to keep the mkts from freezing, etc. And that number that really seemed absolutely unreal to me. Out of that, a lot of it went to companies (esp. those controlled by Private Equity) to pay dividends to their owners. Lots of share repurchases as well I'm sure. So lots of cash floating around with investors for SPACs to keep chugging along till the US keeps adding more money to the mkts.

[jtseun]

I heard someone say "Pre-LOI SPACS are loot boxes for investors".

While they may come off as a pump & dump, all SPACs have a floor of hard cash placing them around $10; notably Ackman's PTSH is $20. Looking at IPOE popping 20% off Chamath's tweets, it does feel like some variant of musical chairs.