I take home from Manohar's lecture that we are all somewhat riskily extrapolating from the past to the future. The TA people are extrapolating stock prices. The fundamentalist extrapolates company performance. We, the latter, gather data on the company and competitors and add it to what we already know and we are certainly predicting the future by our actions, e.g. sell or hold or buy more. So, although TA is fundamentally wrong, i.e. it lacks a valid theory, we who try to predict a company's performance can also make mistakes, because of our lack of data, over or underweighting of certain aspects,etc. We can't neglect this possibility. That's why we don't put all our money into one stock. For example, my major holdings are Softbank, CMG(can't buy it in the U.S.) and QCOM. If there was no uncertainty in our methods then we would all just buy one stock.
Aside from looking at the company itself which is all I know what to do, people like Jay Chen are also always looking at the marketplace, the buyers and sellers out there. Because interest rates for ten year deposits were so much higher in 1990 and 1991 than now, a torrent of money from those expired deposits is expected in Japan to be looking for a higher rate of return. In short, he expects another bubble for Japanese stocks.
Yes, Japan is closed Monday, i.e. tonight.
Cheers, everybody. |
