Don’t worry…there is no bubble!

Markets still act well off of the Greece “deal!” More names are breaking out. 60% of the market is still not working but the 40% is. The good get gooder.

But yesterday, Celgene said it will pay $7.2 billion in cash for Receptos. Terrific! We own neither though we were eyeing Celgene as it headed into earnings. As we write this, Receptos is up $21 and Celgene is actually up $9 as they also pre-announced a higher number for earnings.  But here we go again:

Receptos has no sales. To repeat, they have no sales. Their drug is still in phase 2 trials yet Celgene is paying $7.2 billion in cash. They didn’t buy them when the stock came public at $14. Not at $25…not at $50…not even $100…$150 anyone? Nope! $200…nope! $232 is a good round number. But we just found out an additional item to the story. While the announcement was for cash, it is really not for cash. Celgene is going to raise at least $5 billion in a bond offering to pay for Receptos. Of course, this bond offering will be raised at a rigged, manipulated and fed-induced distorted yield.

We repeat. THESE TYPES OF BUYOUTS DO NOT OCCUR AT BOTTOMS. We will let you extrapolate what that means. For now, don’t worry! There is no bubble!