This Tuesday morning, just before 6:30 am Eastern, Tesla (TSLA) CEO Elon Musk Tweeted “I kinda love Etsy.” That’s it. That’s all, states Mike Larson of Safe Money Report.

But it was enough to whip investors into a frenzy. Shares of Etsy (ETSY), the purveyor of custom-made artwork, jewelry, ornaments, and other products, soared more than $20—making it the S&P 500’s biggest gainer in the early going. ETSY has now surged more than 300% in the last year.

A couple of weeks earlier, Musk Tweeted his followers should “Use Signal,” referencing the encrypted messaging app with the name. That’s it. That’s all.

But traders subsequently bid up shares of a completely unrelated public company named Signal Advance (SIGL). In no time, it soared from just 60 cents to more than $70. SIGL had no sales as recently as 2016 and only employs a single person full time, according to CNBC.

It’s not just a couple of tweets by an eccentric tech CEO driving a couple of stocks higher, though. Individual investors and daytraders have been ganging up in various online venues—including the “wallstreetbets” forum on the social media community and discussion site Reddit—to push multitudes of them skyward.

It absolutely, positively smacks of the kind of stuff I saw going on in the late 1990s during the worst of the dot-com bubble frenzy. And that has extremely important implications for investors, especially “Safe Money” ones who’ve been around the block a few times.

The struggling mall-based retailer of video games, GameStop (GME), is one of the latest, greatest examples. It soared more than 144% at one point on Monday—and has now more than quadrupled since mid-January.

Why? Because we’re not just talking about a handful of daytraders with a couple hundred bucks invested. We’re seeing extremely heavy stock and options buying that is impacting a wide range of names—particularly those that professional investors and hedge funds have been “shorting” on the expectation their shares would decline.

When you short a stock, you borrow and sell the shares. Your hope is that you can buy them back later after they’ve fallen in value. When the shares soar instead, you start losing money hand over fist and you have to buy them back at exorbitant prices. That process is called a “short squeeze,” and it can fuel extraordinary moves like those shown in this GME chart.

Gamestop

Moreover, the frantic buying spread to many other unrelated names this week. Take Clorox (CLX).

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It’s one of my favorite longer-term recommendations in the Safe Money Report. I like the company’s businesses. I like its lengthy history of paying generous dividends. I like its attractive Weiss Ratings track record.

But it’s not some tiny stock that should be easily subject to manipulation. It sports a market capitalization of almost $26 billion. It’s not one of the new-fangled “SPACs” that have attracted so much frenzied day trader interest.

It’s also not a technology IPO. And it has nothing to do with electric vehicles, renewable energy, or any of the other whiz-bang industries that have been pulling in billions of investor capital searching for the “next big thing.”

Yet on Monday, its shares soared out of the gate and kept climbing—on no news. I saw the same pattern playing out in other names as well.

Now don’t get me wrong. I’m happy to see my subscribers make bigger gains. But the CLX action—along with the action in countless other stocks like GME, ETSY, and SIGL—is classic dot-com-bubble-like behavior.

Back then, short-term investors dog-piled into hot stocks thanks to tips shared on Yahoo Finance and Raging Bull message boards. Now, they’re doing the same thing on Reddit.

Back then, money-losing Internet commerce and B2C/B2B stocks soared hundreds of percentage points in days or hours. Now, money-losing EV, battery, and struggling retail companies are doing the same.

Back then, hyperactive traders on platforms like E*TRADE, Datek Online, and Schwab dominated the market for a while. Now, hyperactive traders on platforms like Robinhood are doing the same thing.

So, what does it all mean for investors like you? Well, I’ve been advocating a “Safe Money” approach to this market for a long time. My strategy has involved recommending targeted, selective investments in high-quality, higher-rated, higher-yielding stocks exhibiting bullish trading patterns.

It has paid off well for subscribers in several instances. But this is the kind of frenzied, high-risk, manic behavior you tend to see when a bullish environment starts morphing into a euphoric one.
 
It doesn’t mean you sell everything. It doesn’t mean you rush to join the beleaguered short sellers. But it does mean you want to make sure your portfolio is structured in a Safe Money way, and that you have “insurance” positions in other assets. Think gold, silver, precious metals miners, and the like.

Stick with that, ignore the dot-com-era dreck, and keep an eye on updates like these. I’m confident that if you do, you’ll navigate this environment in much better shape than those who are throwing caution to the wind.

Safe Money Report focuses on these kinds of stocks, which include names in the consumer staples, food and beverage, retail, and healthcare sectors. Visit Safe Money Report here.