Tuesday, October 28, 2014

The New High-Tech Era

Facebook recently issued some new stock to help pay for its acquisition of WhatsApp, an instant-messaging service. Facebook's share price didn't change much as a result, so the new issuance raised the social media giant's market cap to $224 billion. As the Wall Street Journal pointed out, that means that Facebook is now worth more than JP Morgan Chase. Not bad for a company that's barely ten years old.

JP Morgan isn't quite as dominant as it used to be; back in 2011, Wells Fargo passed it up as the bank with the largest market cap. In addition to Facebook, JP Morgan is now also smaller than Google and Microsoft. It may be that we are seeing the dawn of a new high-tech era, this one dominated by behemoths rather than the upstarts of the 1990s.

But all those companies are small compared to Apple. Despite some setbacks in recent months, Apple's market cap is still greater than JP Morgan and Wells Fargo - the two biggest banking stocks - combined.

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