Storied VC says investors are unlearning the lessons of the last bull market. Jeff Bezos says you should listen.

Read: Why a fragile stock market faces danger from rising real yields as ‘TINA’ trade fades

Unicredit’s chief economic advisor Erik F. Nielsen told clients that despite a dismal April, stocks are holding up better than he expected, but maybe not for much longer: “The problem is that asset allocation is always the result of a probability game, but as the odds change with a deteriorating world economy, cash and other zero-yielding holdings might well become more attractive as a parking place for awhile.”

Onto our call of the day , which comes from Bill Gurley, general partner at venture capital firm Benchmark Capital, who famously made an $11 million bet on Uber
UBER,
-4.08%
in 2011. Several of his more than a half million followers sat bolt upright after this Twitter thread:

“An entire generation of entrepreneurs & tech investors build their entire perspectives on valuations during the second half of a 13-year amazing bull run. The ‘unlearning’ process could be painful, surprising and & unsettling to many. I anticipate denial,” tweets Gurley, who adds three points:

1. Previous ‘all-time’ highs are completely irrelevant. It’s not ‘cheap’ because it is down 70%. Forget those prices happened.

2. Valuation multiples are always a hack proxy. Dangerous to use. If you insist, 10X should be considered AMAZING and an upper limit. Over that silly.

3. You may be shocked to learn that people want to value your company on FCF [free cashflow] and earnings. Facebook trades at 14X GAAP & is growing 23%. What earnings multiples are you assuming?

4. Revenue & earnings QUALITY matter.

Gurley linked to his blog from 2011, where he explained that discounted cash flows “are the true drivers of value for any financial asset, companies included,” and that price/revenue is a “dangerous technique because all revenues are not created equal.”

Among those reacting to Gurley was Amazon
AMZN,
-14.05%
founder Jeff Bezos, whose stock is facing its worst year since 2008, after the company’s first loss in seven years:

To some, Gurley’s comments were a warning of tough times to come for the tech sector:

The buzz

Warren Buffett’s Berkshire Hathaway
BRK.B,
-2.55%

BRK.A,
-2.94%
bought $51.1 billion worth of equities in the first quarter in what he called a “casino” market. Chevron
CVX,
-3.16%
and Occidental Petroleum
OXY,
-3.40%
are on that list and he also bought up nearly 10% of the videogame maker due to be bought up by Microsoft, Activision Blizzard
ATVI,
-1.43%.
He and vice chairman Charlie Munger tried to reassure investors at the first in-person shareholder meeting since 2019 over the weekend.

More than 100 companies are still due to report this week, such as Pfizer
PFE,
-2.85%
and Moderna
MRNA,
-5.69%
and Starbucks
SBUX,
-2.53%,
with Clorox
CLX,
-3.28%,
Expedia
EXPE,
-4.72%
and MGM
MGM,
-2.54%
due Monday.

The Institute for Supply Management index for April is coming after the market open, along with construction spending, in a week that will give us not just a Fed meeting, but jobs data at the end of it. Elsewhere, weekend data showed China factory activity hit a six-month low in April.

Civilians in an embattled Mariupol steel mill in Ukraine began evacuating on Sunday. EU energy ministers will reportedly hold an emergency meeting on Monday to discuss Russia’s recent gas cutoffs for Poland and Bulgaria, as Germany vowed to wean off Russian oil by late summer.

The markets

Stock futures
YM00,
+0.27%

ES00,
+0.16%

NQ00,
+0.20%
are moving higher, with bond yields
TMUBMUSD10Y,
2.918%
TMUBMUSD02Y,
2.719%
also rising after massive gains in April.

Commodities are mostly headed the other way, with oil
CL.1,
-3.10%
and gold prices lower.

The dollar
DXY,
+0.40%
continues to surge across the board, but not against the Russian ruble
USDRUB,
-0.38%.
London was on a break, but Europe stocks are selling off, and appeared to suffer a flash crash at one point this morning.

The tickers

These were the top searched tickers on MarketWatch as of 6 a.m. Eastern Time:

Random reads

An Italian football match has become the first to be viewed simultaneously in the Metaverse.

An animated series created by Meghan Markle for Netflix is getting the chop.

Headed to Miami’s inaugural Grand Prix? Be prepared to shell out more than $1,000 for tickets.

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