JDN --
Thanks for your response. We're living in a market environment where stock price equates to quality. When they go up, many assume the company's worth that much. And when they slide --- say, from 300 to 70 --- they scream they're a "POS," when in reality they never deserved the lofty price in the first place. Many of us have watched in awe while companies living on borrowed time continued to go to the sky. How can this be, we'd ask. I'm referring to helium.coms, and one-product-cum-money-laundering shops, not to companies like JDSU and SDLI who have solid revenues and sustainable growth.
When the epidemic of delusion reached its peak and the fever broke, casualties were carried off the field and survivors, who by then realized how lucky they were, promised the gods of fundamentals they'd never stray again.
There's no one person, entity or institution to blame. However, there are some who should have had a higher level of fiduciary responsibility and in the euphoria that early on felt like love and not bubonic plague they didn't. Instead they changed the rules. I'm speaking of financial institutions who brought young companies to market before their products were ready. In many cases they were barely in beta. They saw a hot IPO market and knew if they had the right management team, the right underwriters, a good marketing head, and one "name" customer --- no matter how small the shipment or what happened to it --- even guano.com would double the first day. On the other side of the epidemic, quite a few of these young companies (and the institutions who backed them) are praying like hell they can get unlocked before the market discovers the jig's up. And, please, don't think I'm referring to AVNX. I've looked around enough to know they have some excellent engineers and scientists and a couple products with real promise, so even though they may get put into an ICU for a time, they may recover and one day earn their premature evaluation.
Is GG responsible? Probably no more than the next guy who benefitted from an environment he neither created nor understood. (I'm assuming he didn't understand since I've not met anyone yet who did, except in hindsight.) As for the institutions who invested in these preemies, those who did their due diligence and chose only the best will be rewarded. Those who went for the quick buck, may not do as well.
In the private market, investors have to be accredited before they're allowed to take certain levels of risks. I'm not suggesting this for the public market, but it might not be a bad idea to encourage higher standards for bringing companies public. I know I'm naive, but I'd even like to see more balanced reporting by analysts and other stock promoters.
Pat
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