Thank you Ken for your response. I see exactly what you are saying and do understand it. And yet do not come to the same gloom-and-doom conclusions. It could be denial for all I know, or whatever... something just prevents me to come to a gloomy conclusion.
In September of 1999 I told my wife we would sell all of our equity investments in March of 2000. I knew exactly that we would reach a peak in March of 2000 from the way the .com's were going. As you know I had just stared my own .com company and came to know the industry like the back of my hand and how the investment mentality associated with that worked. Because of my involvement with the .com's I knew the market would peak in around March of 2000. I told many of my friends to sell when March arrives, from my own mother-in-law to my closest friends.
Then came March of 2000, and I was reminded by my dear wife what I had told everyone only 5 months earlier and up to that point, that is to sell everything and sit on the side. And yet I did not! Why? Some (including my own wife) view it as pure stupidity. They maybe right, but there is something else that happened. I came to ask myself what would I do if I sold everything then? Would I simply retire and watch the sunrise and sunset in some ocean beach property with my wife and daughter by my side? Or would I continue to work and/or invest? I asked myself if I needed the money that I was going to get from selling my investments, and I came to the conclusion that it did not matter! I have always been a long term investor - as stupid as it may appear at this time.
I knew the market was due for a major correction because of all the .com's and the side-effects they had created on other industries (such as servers, networking, telecommunication, semiconductors etc.), and did expect for a market correction of at worst 25%. But never ever imagined the .com phenomenon could create such a disasterous domino effect on other industries as we had seen over the past 8 months or so.
I am still in the .com business and do see the trends that are taking place in all the related industries, and can say with confident that things are not as bad as so many talking-heads on the wall street are painting them to be. The market correction is well over done. John Chambers of Cisco today talked about a global slow down but he knows it and those who should know also are aware that he is simply BSing, and playing the game of bringing down the expectations and pushing the FED to aggressively lower the rates.
As confident as I was in September/October of 1999 when I knew March of 2000 would be the peak I am now confident that March and early April of 2001 are the lowest points of the market, and the growth would continue beginning November of 2001 (with markets anticipating that sometime in April/May of 2001).
Could I be wrong? Of course as I have been so many times in the past! But my convictions are telling me things are ok. And sure you can go ahead and Call me an overly optimistic person!
As for Abiomed I never invested in the company since - right or wrong - I have come only to invest in high techs (I am 95% invested int he market with 100% in high techs -- so you can imagine the agonizing pain I am taking!). However having come to know your wisdom I am considering selling a few shares of my not so damaged high techs and shift the money into Abiomed. What are your thoughts on an entry point into the stock?
Best Regards and wishes,
- Addi |
