Something that I think really does separate today’s high valuations for tech companies from what we saw in the late 1990s is that a lot of the key firms don’t actually seem all that exuberant. Consider Apple’s giant cash stockpile:
You see something similar in the sluggishness with which firms are deciding to launch IPOs. Tech company managers don’t seem to believe that they’re in desperate need of capital (from outside investors or from retained earnings) that they intend to invest in expansions. Firms are always trying to grow, of course, but they’re just not chomping at the bit to find more money and put it to work. Facebook, Apple, etc. only have so many ideas and trying to implement those ideas only costs so much.