Mark Cuban expects a shake-out in the stock market as companies built on hype fail, while those with sound business models succeed.
He said that companies that were sustained by cheap, easy money will disappear.
Warren Buffet was quoted by the tech billionaire and "Shark Tank" investor as saying that surging inflation, historic interest-rate hikes, plunging prices of stocks andcryptocurrencies will separate the winners from the pretenders.
When the tide goes out, you can see who is swimming nude, Cuban said. In the last few weeks, Terra and Celsius have run into trouble due to the decline in the value of their token.
transformational applications and technologies, even if they are released during a bear market, always attract customers and succeed according to the Dallas Mavericks owner. He said that until the current flurry of rate hikes is priced in, tech stocks are in a tough spot.
Cuban predicted a market downturn would highlight the long-term winners in the space, similar to the early days of the internet.
"A few others will be similar to those that were built during the dot-com era, survived the bubble bursting and thrived, like Amazon, eBay, and Priceline," Cuban said. Many will not.
Cuban sold an internet-radio startup called Broadcast.com to Yahoo for $5.7 billion in 1999. During the financial crisis, he urged the US Treasury to model its rescues of the "Big Four" US airlines on Warren Buffet's stock-warrant deals.
Jack Reed, who helped craft corporate-relief packages after the housing bubble burst and at the height of the pandemic, told Insider that he was inspired to demand warrants from companies by Warren Buffet's deal making.
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