I had a conversation w/my wife the other day about the absurd valuations of the inut stocks. It occurred to me that speculative frenzies such as these aren't uncommon during periods of rapid advancement. The only problem is picking who will be around when the period begins to slow, or come to a halt.
Some would say this current period may never slow or halt. I disagree. All eras end, its actors get tired. Same will be true here.
What makes ORCL such a great stock is that it provides infrastructure. Most inuts are smoke and mirrors.
Consider the railroads you mentioned. They all were speculative wonders in the early/mid 1800s. In fact, most went bust or were on the verge of it when Jay Gould swooped in and consolidated the industry. Some were scams (Gould's original investments were), but all wound up being bought out for a song, or washed out in bankruptcy. Some survived, and were much stronger for surviving. Consider these to be YHOO and AOL (or don't....). HOWEVER, it IS true that the companies that REALLY made a fortune and virtually all survived (compared to the RRs) were the infrastructure providers and maintainers. The track laying firms, locomotive and carriage builders, etc. These were highly competitive fields, and couldn't provide for too many players. As a result, they chugged along nicely, with little threat from the impending implosion. ORCL is an infrastructure provider, and will only benefit from the current growth, and future consolidation. |
