You have been preaching the downfall of MSFT for over a year now. The most successful software company in the world has nearly quadrupled in price since you started this bashing, . . .
What can I say, call me stubborn.
First of all, I do not believe I am bashing Microsoft, the company. I think Bill Gates is going a good job, as good as can be expected given that he either will not or cannot abandon the Windows franchise. If my goal were to defend at all costs my choke-hold on the personal computer OS in the Age Of The Internet, I'd probably do more or less the same things he's doing. But, there are things I disagree with them on, like whether it is really possible to do what they are trying to do, and I would do things differently if I were in charge. But, you have nothing to fear from me -- I'm no where near being in charge.
Second, as for the stock, yes, I think it is overvalued. The fact it has quadrupled only means it is now four time more overvalued than it was when I first started saying it is overvalued. Obviously, neither you nor anyone else of import, apparently, agrees with me, so, again, you have nothing to fear from me. I'll just keep posting, and the price will just keep on going up, and everyone will just keep on being happy.
But remember:
Manias always go to extremes. Things can get extremely undervalued or extremely overvalued. Furthermore, the majority of paticipants in any mania can always come up with some rationalization or other of why their tulip bulbs or gold and silver bullion or watered stock or whatever is not overvalued. Remember Bunky Hunt? He thought the price of silver, at $60 an ounce, was a bargain. Remember $80 a barrel oil? Most people thought oil couldn't possibly go down and that OPEC would rule the world. Where are those people now?
Today, the Great Microsoft Stock Mania is no exception. Everybody loves Microsoft. Chairman Bill can do no wrong. It's going to grow 35 to 50 percent a year -- forever. The stock price, like $800 an ounce gold, can't possibly go down.
And, as a participant, indeed, an abettor of the mania, you are no exception, either. Your "Regimodel 2000" stock valuation methodology, which says, in essence, that earnings don't matter, revenues are unimportant, etc., is a classic example of the rationalization of excess.
What goes up will come down, and, the higher the stock goes, the harder it will fall. It won't happen tomorrow, but, someday, Bill G. is going to screw up, or maybe die in an accident or assasination (let us hope not -- life is always more precious than money), or have some other calamity happen to him or his company, or the software industry is simply going to go out of favor on Wall Street. At that point, the blinders will come off, and and the stock is going to tank, big-time, taking all the carpetbaggers and fellow-travellers in the analyst community down with it.
. . . and it now threatens to take over the very paradigm which you once thought threatened its existance. I do hope you don't invest using you economic theorems:-)
I'm not sure what "paradigm" you are talking about. But if you are talking about the Internet/network-based computing paradigm, I have to disagree with you. Microsoft is in no danger of taking over Java or the Internet. The reason is simple: Microsoft is an Operating System company above all else. Everything else is just a sideline, a way to profit from its dominance of operating systems. Microsoft is utterly dependent on Windows. They are talented, but why try to do anything else when the money is so easy in Windows. Everything they do is designed to protect and promote their control of Windows. Anything happens to Windows, they're toast.
The Internet is more powerful than Windows. If Windows does not conform to requirements of the Internet, the Internet will simply relegate it to Ronald Reagan's dustbin (you know--the one to which he relegated Communism;)). It's already happening, with the NC, open standards, the browser-as-platform phenomenon, Java, the list goes on and on of innovations that threaten to undermine Microsoft's control of, or the significance of its control of, the operating system.
So I am not concerned about Microsoft taking over the Internet. They might be able to destroy it, but they will never be able to take it over. |
