Canadian Financier is warning about tech bubble

Is history about to repeat ?  

David Friend of CanadianPress at YahooFinance:
Financier Prem Watsa says some of the biggest names in technology, like Facebook and Twitter, are headed towards disaster because their stock prices have soared too high.

The chairman and CEO of investment firm Fairfax Financial (TSX:FFH.TO - News) told investors Wednesday at its annual meeting he believes some of Silicon Valley's most-prized companies are sitting on unproven foundations.

"There's nothing underlying the value of these companies," he said, referencing a chart that outlined names like Netflix and LinkedIn.
"The last time this happened was in the dot-com era. I can tell you this is going to end in tears, because it always has."



Last week, technology stocks came under pressure on Wall Street as traders became concerned they were overvalued in an uncertain global economy.

Watsa has been increasingly vocal about his concerns for the technology sector.

In a letter to shareholders in March he criticized Facebook's decision to purchase mobile phone chat program WhatsApp for US$19 billion, calling it "the poster child for the excesses that prevail in the tech world."
When it comes to investments, Fairfax has traditionally stayed away from the volatile technology sector, with the exception of Canadian smartphone company BlackBerry (TSX:BB.TO - News).

The firm headed a consortium of investors who injected US$1 billion into Waterloo, Ont.,-based company last fall, after a failed attempt by Watsa to raise enough money to take it private.
Fairfax later exercised an option to buy an additional $250 million of convertible debt in the smartphone maker tobring its share of the financing to $500 million.....