I'm sorry Alex, I was not intending my response as a personal attack nor did I mean to call you ignorant. Please accept my apologies.
You are correct, I wish I did buy Ktel or any other of the many internet stocks that have quintupled in the last couple of weeks. But common sense prohibits me from doing so. This is actually a market for the common man is what I was meaning to say. Historically, everyone can not make a profit. Historically it is a zero sum game. Historically, the professionals make out big and the common man loses in the end. I believe at this point in time everyone you encounter on the street has money in the market and every one you talk to is talking about the stock market. Historically, this has been an indicator of a market top. Most of these people understand little if anything at all about what are the underlying principals that make one company worth more than the next. When you reach this stage of the game it is only rising prices that people can point to as a reason for buying a stock. That is a bad reason. These were the reasons written about by Graham and Dodd and many othere in the 30's for the crash in '29. Now, I am not suggesting that we will crash like that, but certainly the smart money is moving out as the little folk get in.
Even, Warren Buffet has been a net seller this year and is buying commodities and bonds basically for the first time in his life. That, IMHO says a lot about the current market conditions.
It is pretty clear to me that interest rates will rise this summer, then we will see how resilient the stock market really is.
AMZN has no breakup value, and for all practical purposes is bankrupt. If the market shifts towards caution and moves to protective stocks for a rising interest rate scenario, AMZN is vulnerable to a 75% drop very quickly....good luck to you, and don't get complacent....;^) |
