I forgot how hard it is to type out a trillion. And I equally forget how often this number is thrown around in finance circles despite it being a ridiculously abstract and hard to understand number.
I am reminded that Apple has casually added $1 trillion to its market cap since the start of the year – there’s no way that’s ever happened before. What I mean is, $1 trillion in market cap has been added to Apple in about 7 months time:
Back in 1983, a mere 40 years ago, the largest company on the planet was AT&T. How big was AT&T’s market cap? It was worth $50 billion. Back then, people had never heard a number like that. $50 billion? Are you kidding me? The barbershops and shoe shiners were bustling with conversation “ain’t nothing ever going to be worth $50 billion again in my lifetime.”
Maybe it’s inflation, maybe it’s progress, maybe it’s the speed of money globally, or, more likely it’s all of that packed into one that got us here today.
I’m starting to think it’s never been more important than now to reevaluate my understanding of large numbers.
Here’s a simple thought exercise: try to envision 1 trillion dogs running around a park or city. Here’s another one: try to envision 1 trillion pieces of paper floating in the sky. It’s basically impossible to envision that many things. Our minds can’t comprehend it and yet it’s now apart of markets and life. It took me a full minute, maybe more, just to write out $1 trillion by hand, count the zeroes, and double check it. Even on my phone, using a calculator, it’s not easy to do.
Does this mean a major bear market coming to reset valuations? I have no idea. Perhaps just like in 1980, while most people think these numbers are unsustainable, the next $10 trillion company is next. Either way, I’m trying it’s pretty jaw dropping how 1 trillion became a norm so quickly despite the impossibility to grasp what it really is.