I didn't sell anything because it went down. I sold it before it went down. I didn't get scared out like Addi, quite the contrary, I held through the scary times. That's the idea, from what I understand. Benjamin Graham may have said to hold a stock until the reason you bought it goes away, but he also said "buy low, sell high". Notice the "sell" in that sentence? I sold SUNW because it had gone UP so much that I had two choices: sell some (not all) and realize a significant gain, or gamble that it would go up even more, that we'd get another ten-bagger in five years so I could leave my kids foundations instead of trusts--*even though I knew we were in a tech bubble that was benefiting Sun's share price*. I chose to take some profits.
Well, when the rupture happened we got off kind of lucky. You chose the continued risk of all your large gains. I, to some extent, didn't. But I never got shaken out.
A recession in the world economy (starting in the U.S. which will drag down everybody else) is already here. I mean, look at the layoffs and plant-closings every day, why do you think the Fed is suddenly acting like the Marx Brothers?
I don't expect another Great Depression or Tokyo-90, or to see SUNW at $10. But I do believe we've departed one cyclical period and entered another. Enough damage has been done to the stupid, greedy and unlucky so that stock market mania with its wealth effect and random valuations will take a while to come back. If we go back to P/E's over 100 for more than a handful of tech stocks, I for one will be quite surprised.
Of course I hope for both of us that I'm wrong and you're right...I still own more SUNW shares than the man in the street. Maybe the Fed will just flood the world with money and CNBC will start holding swimsuit contests where bimbos representing money-losing companies compete for the title of Ms. NASDAQ, and we'll be right back in the bubble again.
You're betting on a trillion-dollar valuation. And I'll join you...but not with everything I own.
--QS |
