It's playing out exactly as it is supposed to play out. The companies that are riding the big growth themes go higher. The companies that help themselves with aggressive buybacks and big dividend boosts go higher. The companies that sit there, the ones that don't get busy living, are getting busy dying.
Let's take Facebook (FB). The simple fact of Facebook is that it is the fastest-growing big-cap stock in America and that's because it is surfing the fastest-growing themes in the country, and the world: social, mobile, the cloud and, let's add another, connectivity.
This is a company that owns the young-person demographic all over the world that has a product that works best when on the go. It is the modern way, other than Google (GOOG), for advertisers to connect with potential buyers. It ends that old saw about advertising -- you know, 50% of advertising works. I just wish I knew which 50%. Here, it is 100% of advertising that works, which is why Facebook might end up being the greatest advertising vehicle of all time. It can be used for branding, it can be used for direct marketing, it can be used locally and nationally to a preselected audience that wants the product and the audience is the right demographic, meaning that it is reached before people really make up their minds and get set in their ways and become too hard to sway.
It is a company that has accelerating revenue growth and, even as its expenses are sky high, the revenues are far outstripping those expenses, which is why it has such amazing gross margins (what's left over after the cost of everything that goes into the product).