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Strategies & Market Trends : MDA - Market Direction Analysis

SPY 671.91

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Nov 14 4:00 PM EST

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To: bobby beara who wrote (39277)	2/5/2000 8:12:00 PM
From: Haim R. Branisteanu	Read Replies (2) of 99985

BB, what is your take on IBM around 112 now ?(or $224 pre-split) Why?? I just reread some of the remarks I made on the Chicken Page in May 1999 May 15, 1999 - Most recent example of irrational stock buying is IBM. Louis Gerstner of IBM started touting his company as an Internet play - net result the stock went from $220 to $245 for no other reason than speculation. IBM's market capitalization grew by $25 billion just for a nice story and prep talk ?? - there were no new financial facts or better earnings prediction JUST SPECULATION!! (it was above $270 later) Those $25 billion in added valuation can account for several countries GDP or about 5 to 6 weeks of money flow into the US mutual funds. To make some sense of the irrational market behavior - Poland with a population of 38 million has a yearly budget of $34 billion and national debt of $43 billion. Austria with a $21,000 per capita GDP has a national debt of $30 billion similar to Belgium national debt of $31 billion and Denmark's national debt of of $44 billion (sources the CIA World Fact Book). Does their government "prep talk" eliminate their outstanding debt in two days??? Well I do not think so. Haim

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