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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 220.66

+1.6%

Nov 21 9:30 AM EST

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To: Eric Wells who wrote (79447)	10/3/1999 1:31:00 PM
From: dbblg	Read Replies (2) of 164684

>>Do you know for certain that he has expressed such caution in the past? No. As I tried to make clear, I don't follow many of the sell-side analysts very closely at all. I do recall hearing him mention that he thought inet investments were only suitable for a small portion of even aggressive investors' portfolios. >>Blodget has changed his schpeel to a more cautious tone. Agree. One of the things on my checklist for upping my inet investments is increasing caution from the sellside cheerleaders. I don't think we're there yet, but this is part of that process. >> I think if he had used the above words in any past pronouncements on the value of internet stocks, we might not have experienced such exhuberance on the run-up of the i-nets (or Blodget wouldn't be as popular as he is now). Over the past couple of years, a series of non-events, such as price-target increases from analysts and stock splits, caused exuberant run-ups, as did announcements such as AMZN's entry into music and gift sales, which by all rights should already have been factored into the price. I believe that these run-ups merely reflected the huge short positions in the stocks, and the enormous power that conferred to the momentum funds who have had a LOT of fun with technology stocks in this decade. Any excuse was good enough to stick it to the shorts. (Others, such as KIS, believe the run-ups are evidence that longs in inets are all naive idiots and/or lambs being led to the slaughter by sell-side analysts. Both phenomena probably coexisted, though I tend not to place too much credence in any theory which assumes that the traders making money in the market aren't as smart as the traders who are losing it.)

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