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Strategies & Market Trends : Gorilla and King Portfolio Candidates

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To: Uncle Frank who wrote (44603)	7/17/2001 8:11:51 PM
From: 100cfm	Read Replies (4) of 54805

As far as the contrarians are concerned, KT and others have been proclaiming the market over valued for many years They have been wrong since 82. They are right now but not for the reasons they think which means they will be wrong again in the future. Quality stocks such as discussed on this thread got ahead of themselves but were not at bubble prices until Greenie slammed on the brakes and killed all growth. So a company trading at 150-200 times earnings growing at 100% was fully priced or overvalued but it was by no means a bubble stock untill it's growth went to 10%. Then it's price became ridiculous and thus the bubble moniker. Most of the companies followed here were not at fault for the swan dive in their growth rates, in other words their stock prices didn't fall to the levels they are now because their prices were too high but because greenie took the economy from 5% to 0-1%. By contrast almost all the dotcoms were at fault for their own demise by means of faulty buisness models and it didn't matter whether they had ridiculous PE's or Pe's of 5. So now everyone has PE religion, it's only right now because growth rates are nil or non existant along with visibility. Technology is a growth industry, prices at almost any level without growth will seem too high. We just need to be more cognizant of the overall economic picture and the Fed next time around. At least we'll have plenty of time to get ready. 100 PS: I still have failed to see how the state of our economy and that of the world's today is better then the 5% growth rate we were in during the "BUBBLE". Thank God we had Greenie to save us.

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