We are being taken for a ride, IMO!!!!!!
(Manipulative tactics? One day the world is coming to an end and the next day it couldn't get any better)
=========================
"But don't bother telling America's financial journalists just yet, they all love playing with bears. "
'New Economy' booming -- summer rally ahead
Bullish megatrends keep you ahead of game
By Dr. Paul B. Farrell, CBS MarketWatch
Last Update: 12:15 PM ET May 26, 2000
Mutual Understanding
More "FarrellonFunds"
LOS ANGELES (CBS.MW) -- Bubble bust. Nasdaq crushed. Dot.coms bleeding cash.
Options vanish. VCs stop funding IPOs. Websites disappearing. Bankruptcies. No more
get-rich-quick schemes. Tech's risky business. So, goodbye New Economy. Right? Wrong!
Here's my advice: Don't listen to all the doomsday rhetoric
rippling through the financial press and media today. For a couple
months the national press has been on a steady diet of bear market
scenarios covered with doom'n'gloom. Irrational fear hangs over
the markets. Bla, bla, bla. Listen to these bears at your peril,
you'll miss the upturn.
New economy getting hotter
Most so-called "breaking news" today is really old news. It will
mislead you. Remember Jack Schwager's warning in the New
Market Wizards, "Don?t get caught up in mass hysteria. By the
time a story is making the cover of the national periodicals, the
trend is probably near the end." Well, we're way past the end. On to the next cycle. And
recovery.
How do I know? Well, I couldn't miss the shift in the latest Wired magazine with a cover
story blaring a new message: "Keep cool. The New Economy is Hotter Than Ever." Filled
with upbeat forecasts about the new economy. And thick. I mean lotsa pages, 400 to be exact.
New economy magazines bullish
Then the latest issues of the other key new economy magazine start arriving. Complete with an
announcement that the Business 2.0, which is less than two years old, is doubling its
frequency, from monthly to bi-weekly. The new economy is really red hot, if these magazines
are any indication, regardless of what the stock market and America's financial journalists are
grumbling about.
NEW ECONOMY MAGAZINES
Frequency
June Issue
Red Herring
monthly
628 pages
Business 2.0
bi-weekly
472 pages
Fast Company
monthly
418 pages
Wired Magazine
monthly
400 pages
Industry Standard
weekly
272 pages
Wow! And all of them are noticeably thick, chock full of lots of content, and backed by
mucho advertisers. So if you're a serious investor interested in knowing where the new
economy's going in the next 18 months, you're strongly advised to subscribe to all five of
these magazines.
Get the picture? Seriously. Please notice the stark contrast between:
Heavy negativity in the daily financial press. Think about what you've read
and watched in recent weeks. Doom'n'gloom financial journalists have been telling us
for months how bad things are. Typical is the InvestmentNews saying: "the stock
market hasn't gone on this wild a ride since the depression." The depression? And
maybe "the market could rally toward the end of the year."
In contrast, 'new economy' magazines are upbeat. Contrast the
doom'n'gloom with the traditional press (which is fear/greed driven) and the
obviously vibrant health of these thick new economy magazines. Ask yourself: Why
in God's name are these five new economy magazines bulging with ads and content
about the new economy -- if the stock market is in the doldrums? Why?
The contrast is striking. You just know something's wrong with
this picture. What's wrong is the "irrational exuberance" of a
bubble market who's ego was hurt in the tech crash, and is now
hiding in their "irrational fear," the downside of the exuberance.
But there's no problem with the new economy, just the market.
Megatrend research helps the winners
Why is all this so important for you to understand? Listen. First
of all, you already know you can't trust the daily press and the
media. Most of what you read is misleading you. That almost
goes without saying.
But even more important here are the exceptions to the rule, when
it comes to the new economy. And I take a cue from the author of
"Megatrends," John Naisbitt, who also wrote "Megatrends
2000," "Megatrends Asia," "Megatrends for Women,"
"High-Tech/High-Touch," "Re-Inventing the Corporation," and
"Global Paradox." In 1994, before the Internet really took off,
Naisbitt predicted that:
"The telecommunications revolution will enlarge
the role of the individual with more access to
information, greater speed of execution, and greater
ability to communicate to anyone or to great numbers
anywhere, anytime. All trends are in the direction of
making the smallest player in the global economy more
and more powerful." He has always been ahead of the
curve.
The kind of research Naisbitt used to pinpoint his cutting edge
megatrends predictions came to mind when I saw the five huge
new economy magazines in the table above. We read of his
methodology some years ago. Naisbitt's research consisted of
screening all major newspapers and measuring the amount of space editors and publishers
devoted to various topics. Regional variations and changes over time were recorded. Trends
and megatrends emerged.
Big advertisers bullish on economy
And since virtually all magazines are advertising driven, and since
B2B is the megatrend in Internet technology, we can conclude
that there are huge numbers of New Economy businesses out
there still attempting to reach other new economy businesses,
decision-makers and investors -- in spite of the fear-driven
misguided stock market.
Naisbitt's research is simple, yet effective. And his kind of
research thinking was on my mind when I noticed the huge New
Economy magazines arriving with June publication dates -- while
the traditional financial press and media were still singing the
blues about the March collapse of the stock market, focusing on
Nasdaq's precipitous 37% drop.
New vs. old economy magazines
Next, out of curiosity I did my own crude Naisbitt-style
comparative research: By measuring the number of pages in several old favorites in the
financial journalism world, to see how they are faring at this time. Turns out that the five New
Economy magazines were beating all but one of the thirteen traditional financial magazines
screened:
TRADITIONAL FINANCIAL MAGAZINES
Latest Issue
Fortune
320 pages
Business Week
264 pages
Forbes
230 pages
Entrepreneur
220 pages
Money
216 pages
Smart Money
192 pages
Inc.
188 pages
Worth
154 pages
Kiplinger's
136 pages
Mutual Funds
108 pages
Bloomberg
108 pages
Individual Investor
104 pages
Online Investor
82 pages
Okay, I know there are a lot of differences among these magazines. Admittedly, my research
is far from perfect, more anecdotal that statistical. Crude yes, but a basic version of Naisbitt's
megatrends research. And, if the success of these magazines is any indication, the advertisers
(and the investing public) are clearly making big bets on the new economy -- and that, folks,
is a very, very positive mega-trend.
The fact is, these five new magazines covering the new economy are contradicting the stock
market and its sentiment indicators. And the contrast between the economy and the market is
huge -- big enough to suggest that the market, especially Nasdaq and technology stocks, is
likely to go roaring ahead for a summer rally soon.
New economy funds already in rally
Oh, I'll bet you're wondering how well the Wired New Economy Stock Index is doing. After
all, you do want more than a fat magazine to read, right! Well it's doing very well. And you
can track the index two ways, on the Wired website, and also in a Guinness Flight Wired
Index Fund profile. The Guinness fund tracks the Wired. They even call it "a fund for a new
economy."
GUINNESS WIRED INDEX & FRIENDS
Ticker
net assets
% 5-yr rtn
% 1-yr rtn
Guinness Flight Wired Index Fund
GFWIX
$ 0.2 B
--
37.8
Fidelity Select Electronics
FSELX
10.7 B
45.2
107.1
Firsthand Technology Value
TVFQX
3.7 B
52.5
104.3
Invesco Technology
FTCHX
4.5 B
36.6
91.6
Fidelity Select Technology
FSPTX
7.2 B
39.1
73.2
Fidelity Select Computers
FDCPX
3.6 B
38.9
61.2
Fidelity Select Software & Comp Serv
FSCSX
1.3 B
31.1
55.7
Fidelity Select Developing Comm
FSDCX
2.9 B
33.0
50.4
T. Rowe Price Sc & Technology
PRSCX
14.2 B
29.2
43.6
T. Rowe Price Media & Telecom
PRMTX
1.1 B
--
31.5
The Guinness/Wired Index fund is a relatively new fund. In addition, it's not included in the
Science and Technology peer category, along with some other New Economy-related funds.
However, in the Wired cover story, "Keep cool. The New Economy is Hotter Than Ever,"
you can see a comparison of the performance of $1,000 invested in March 1995 versus some
of the other major benchmarks:
$ 7,858.68 Wired Index
$ 5,595.66 Nasdaq
$ 2,992.91 S&P 500
$ 2,626.92 DJIA
So folks, if the Wired index is doing this great compared to the Nasdaq, S&P 500 and the
Dow, you have a great choice, plus some great alternatives to bet on as the new economy
kicks into high gear in the coming summer rally. All these funds have long-term track records,
and great performance numbers.
So remember to "keep cool," and remember, "the new economy really is hotter than ever!"
You can bet on it. But don't bother telling America's financial journalists just yet, they all love
playing with bears. |
