[Bewildered Bears]
Excerpted from the San Francisco Chronicle, July 15, 1997. Note: Greenberg is one of the more bearish columnists. PairGain receives national attention today and Texas Instruments reports 5-fold earnings increase. The Bears are bewildered.
Herb Greenberg
Item insanity:
-- Bearly alive: It's painful these days to talk to shortsellers, who bet that stocks will fall. Most say they've never experienced anything quite like the current market -- aside from the 1983-to-1989 boom in Japanese stocks, when the Nikkei Index soared from around 7,000 to a high of around 39,000.
Yesterday's 21-point rise in the Nasdaq composite index was viewed by many as the ultimate in irrationality. ``It's a Tokyo-like mania,'' says Bill Fleckenstein of Fleckenstein Capital in Seattle, who has been quoted here and elsewhere predicting the collapse of personal computer stocks -- only to see them go straight up. Fleckenstein insists that prices of many tech stocks ``have ceased to have anything to do with the underlying business.''
What's particularly disturbing, he says, is that even after companies such as Intel, Hewlett-Packard, Gateway 2000 and Seagate announced that earnings won't meet expectations, their stocks have resumed rising. ``People want to buy stocks because they're acting well,'' he figures. ``It's a performance derby out there.'' |
