Wondering how to balance too much supply with too little demand?
"In his "No Huddle Offense" segment, Cramer sounded off on the deluge of software-as-a-service stocks. He reminded viewers that nothing kills a bull market faster than oversupply," TheStreet's Scott Rutt wrote in his Mad Money recap. "Many of these software stocks are trading at huge multiples with no earnings to speak of. That makes them particularly vulnerable in an economy with rising inflation. Inflation makes future earnings worth a lot less. And while these software companies have growth, many of the industrials have growth as well, with earnings to boot."
"But the software stocks have other issues as well. Many are riddled with insider selling and looming lockup expirations. Many of them are performing secondary offerings that are hurting existing shareholders, and many of these names that came public via SPACs simply weren't that good to begin with," he continued. "That's why we saw declines like we did Monday, Cramer concluded. There is simply too much supply and not enough demand."
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