The Dow Jones Wilshire 5,000 dropped from a 2008 high of $17.9 trillion to $10.2 trillion, representing a $7.7 trillion loss of wealth. The entire NASDAQ market capitalization has dropped 46% to $2.7 trillion in 2008 from $5 trillion in 2007. Hundreds of companies have delisted and many more will need to do the same. Financings have dropped significantly in 2008. 70% of the roughly 2,900 NASDAQ companies are trading below $300mm with median market capitalization of $47mm. At least 20% of NASDAQ (500 companies) should not be public and, worse yet, the valuations of those companies are roughly 0.6x LTM revenue, driven as much by the fallout due to redemptions at hedge funds and other small cap investors as by fundamentals.

Valuations are so low that potential sellers are holding on, and performance, among some, is so bad that potential buyers are afraid to make the bet. Nonetheless, NASDAQ tech companies will be feed-stock for strong strategics, both public and private, and PE firms in 2009 and 2010. AGC believes 2009 will represent one of the best buying opportunities in the last 25 years.

The following illustrates the current make up of the NASDAQ Global Markets: