Good reading from RB:
By: rnawayjm
Reply To: 63009 by Fuse1 Friday, 28 Jan 2000 at 12:45 PM EST
Post # of 63046
OT: To Fuse1 and all: My 2cents...beware.
I'm of the view that we only have corrections, because that's what we are programmed to do through the investing "rules" that we have chosen to put on ourselves. Why do we need to have a single event that brings the total value of stocks down 10-30%, before they go right back up again? It's all psychological.
If people want to pay high multiples for stocks let them. Screw the rules, past history, moving averages, p/e's, the fed, Greenspan, bonds, rate hikes. We have to change our approach to investing all together, The OLD RULES are outdated and no longer serve the same purpose in the new hi-tch world in which we know live. Everything has changed, but we refuse to let go of that dated thinking. If me, and everyone else are willing to pay $1000 for YHOO, then so be it. ...Like I always say, You NEVER see Beanie Babies having a fuc**n correction, do you? You know why??? Because they have chosen not to apply rules to their "market", they let the market set those BB values! That's why an 8- cent bean bag, can sell for $5000. Imagine if they tried applying the rules that we use in investing, to their "commodities."
Everyday, more and more money enters the market. The "average joe" is online, and investing in stocks, ...savings accounts and CD's are dead. With all this new money, comes higher stock prices, higher pe's, and unfortunately, out comes the bears with their economics book from 1956, saying how everthing is overvalued, and it's not healthy, and boy would their prof. at the Wharton school be scared right noe, etc...
If we could just stop applying the prehistoric investing techniques, that were meant for the "old days" of investing, when it consisted of the pros and the rich.
THE PARADIGM HAS SHIFTED, LET'S EMBRACE IT! Maybe when the old guard has had their place on earth, will we finally be able to see a change in philosophy.
Of course if you pick the wrong stock, not of this matters anyway!
Steve |
