Wall Street Is Happily Blowing Twitter's BubbleS

Twitter is not a profitable company. Maybe it's on its way to becoming one, or will be someday, but the company's most current numbers show it taking a loss. But as the New York Times makes clear, plenty of myopic, gung-ho investors are trading Twitter like it's Exxon.

If you buy Twitter stock today, you're gambling on the hope that Twitter will make many billions of dollars on sponsored tweets, which of course, hasn't happened yet. And yet, TWTR is trading at well over twice its IPO price. It's shares are doing far better than Facebook's, which is both profitable and used by over a billion people around the world. This "doesn't make sense," and yet, here we are. Some of the smart people who think about money all day are throwing up their hands:

"I just haven't seen something like this in a long time," said Robert S. Peck of SunTrust Robinson Humphrey, who had set a price target of $50 before the I.P.O. but cut his rating to hold two weeks ago when shares reached $59. "They don't have earnings. They don't have free cash flow."

As Barron's, an investment advisory publication, put it over the weekend, "At $45 billion, the company may have the highest market value of any firm that isn't generating any earnings since the dot-com bubble of 1999-2000."

But remember "isn't generating any earnings" means precious little today. Inside the company, employees are living it up like their peers at companies that actually earn money:

Hey now, braised beef cheeks are for closers!

But, maybe it's just in the air? Can we blame people for irrational exuberance when it's so much fun? If Snapchat, which hasn't even really tried to make dough, can turn down a $3 billion buyout, are Twitter investors crazy for being so bullish? Yes, of-fucking-course.