How high will Microsoft fly? Message Board

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Technology Stocks : How high will Microsoft fly?

MSFT 511.36

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3:59 PM EST

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To: techtonicbull who wrote (42961)	4/22/2000 4:31:00 PM
From: James F. Hopkins	Read Replies (1) of 74651

To All; MSFT still has a lot of headaches to come, cbs.marketwatch.com -------------- I can't help remembering of how IBM was the hot must have stock back in the late 80s, and by the mid 90s it had lost half it's value..the few who were not forced to sell had to wait another 4 yrs to get even..( dead money for over 10 yrs and when it got back to it's old high one needs to "calculate the inflation factor" as a new high 10 yrs later means you have to take off about 4% compounded for 10ys due to inflation. Not to mention what one could have made on the same dollars in just plain old T bonds. -------------- Fact is I bought some GOV coupons back when IBM was the must own stock..that I cashed last yr for a double.. and during that time those lowly coupons made me more than if I had bought IBM. -------------- Compound interest is amazing, leveraging it even more so. ------------- Who would be interested in a lowly double every four years , not any of the hot shot "buy the tech and get rich quick people" ------------- The longer term problem with this Tech bubble and new economy hype is people don't think it through. (1) If profits are going to be so phenomenal the field gets crowded but fast..only the first few years and the first in make the killing..and within a few years the lack of pricing power gets to where even the ones who broke ground are just hanging on and "scratching out a profit based on cutting expenses" It always comes to that sooner or later. (2) The Phenomenal profit idea has the back lash of killing off it's product..just like the oil barons who jacked up profits too high found out in the past. (3) If it's as lucrative as the prices and P/Es the tech sector goes for, then if nothing else it creates a black market competition that won't be stamped out any easier than the illegal drug trade. (4) If you look beyond all the hype you will find a dirty little not talked of much secreat..many countries don't consider US patent laws always valid. But they also want in on the tech pie, so even now they tongue in cheek say make all the copies you want, just don't get caught selling them. MSFT is passed around "free" in many countries and it's trying desperately to bring the hammer down on what it calls illegal copies.. The next plan is to make computers that only have a minimum start up kernel and force every one to connect to some capitalistic server where they must "rent" the software to do anything with. Do you think that plan will fly ? Jim -----------

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