In 2000, we had same concentration in largest cap NDX issues. Valuations were extreme as well.
This time around, the kool aid being handed out is that that the largest US multinational companies earn the majority of earnings outside the US where growth is stronger then US economy. Also, foreign earnings are translated into higher profits due to weak US dollar.
This year is first year in recent memory that we are importing an absolute smaller amount of imported goods. Asian industrial production if still growing at double digit rates much of it must be heading to other Asian countries or to internal consumption because it isn't headed here.
Tech earnings in late 90's were inflated with all types of sham sales especially with internet, networking, and telecom. When the Chinese are faced with admitting to slowing growth vs booking questionable sales to meet foreigners expectations for faster growing Chinese equities; they will follow the tech stock bubble accounting rules.
If foreign growth slows, US dollar will appreciate being the safest haven and US corporations will take double hit with lower foreign sales and weaker earnings due to currency translations of the stronger dollar.
