Qualcomm Incorporated (QCOM) Message Board

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Technology Stocks : Qualcomm Incorporated (QCOM)

QCOM 174.01

-0.3%

Nov 14 9:30 AM EST

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To: Skeeter Bug who wrote (48679)	11/10/1999 12:24:00 AM
From: cfoe	Read Replies (1) of 152472

Without agreeing or disagreeing with what you say (and you said it well, IMHO), two things came to mind as I read. The first comes from a colleague of mine who is a world class (based on long run performance) portfolio management personage. His take on the market: the main reason stock prices are increasing is that peoples' expectation as represented by the p/e ratio are increasing. That is they are willing to pay a higher price for future earnings (dividends + growth). It is as simple as that. Now the fun part (what makes horse racing interesting) comes when we argue why is this happening - fundamental change or irrational exuberance or whatever. Second is something I have seen Larry Kudlow say, but have also read from a few others. One way to look at the "new economy" or the "new paradigm" that is impacting valuations is as follows: The Internet age has ushered in an economy of increasing returns versus decreasing returns. (Of course this is overall, and not on a company by company basis.) I am not sure I can explain what this means very well, let alone defend it. But it would "explain" the increasing valuations we are seeing. FWIW

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