Bill, same here. what people fail to appreciate imo is the fact that for all the promise of the web it is still far from clear if the so-called nutz 'leaders' will ever make money to an extent that is commensurate with their valuations. hell, with some of them it isn't even clear if they will make any money, ever. the internet is the ultimate leveler and deflationary tool. i have a search engine installed that tells me after i have read, say, the reviews on a book i intend to buy at the AMZN site, where i can get it for the best price. why should i pay more? everything is just a mouse-click away. it is interesting to watch how the nutz are already in the grip of consolidation fever. witness the all-paper acquisitions by YHOO and AMZN. large-scale consolidation is typical for an industry that finds it ever harder to make money. of course WS puts a positive spin on this, with talk about 'reach', 'eyeballs' and other arcana. the flood of net IPO's is testament to the non-existent barriers to entry and the growth of registration of web addresses is as well. sure, there will be leaders in this business, but no-one knows if the current crop will be among them. i frequently hear the argument that companies like YHOO, E-BAY, etc. are going to 'grow into their valuations'. no-one seems to consider the possibility that those valuations may have to come down. as you say, they are now 'core holdings' and every WS outfit has a highly paid touter-in-chief a.k.a. 'internet analyst' whose pronouncements are considered holy writ by the herd. they come up with fancy models designed to rationalize the prices of the shares they discuss, instead of simply admitting that there is absolutely nothing rational about them. btw, the personality cult evolving around 'influential analysts' is yet another amusing sideshow in this mania.
regards,
hb |
