Is this a new tech bubble?

LinkedIn's share price rocketed after its flotation last week, as did that of Renren - China's Facebook - after its recent debut, but with more internet firms waiting in the wings, is this a new tech bubble?

Ten years after the last internet bubble burst, "valuations for digital businesses are again rocketing skyward", says Steven Rattner in the FT. Last week LinkedIn FaceBook for businesspeople floated at $45 a share, jumped to $124 on its first day, and finished the week at $94. That gave the company a market value of $9bn, or 36 times last year's revenues and 600 times its net income.

Renren, China's Facebook, peaked at 100 times sales after its recent debut. Microsoft's recent purchase of Skype valued the internet telephony group at a punchy ten-times sales. Facebook is not listed, but in the unofficial private market that has developed to allow early investors to cash out, shares have been changing hands at around 30-times sales. "A trend towards irrational exuberance is emerging," says Fidelity's Tom Stevenson in The Sunday Telegraph.

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