SAP A.G. Message Board - Msg: 5701722

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Technology Stocks : SAP A.G.

SAP 251.89

-0.8%

Nov 7 3:59 PM EST

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To: Sam Citron who wrote (2488)	9/9/1998 11:26:00 AM
From: mauser96	Read Replies (2) of 3424

OTOT... Sam, while I agree with what I think you are implying ,that today's market has it's own "nifty fifty", that doesn't mean that some of them didn't turn out to be good long term investments despite the high P/E. The genuine growth companies like Mc Donalds and Disney are a lot higher today than they were in 1973. It's a big "if" but if a company can maintain a high growth rate it's worth a higher P/E than low growth companies. The basic thrust of your quotation is valid because a lot of the high priced companies today are going to turn out to have slower growth than expected. It wasn't just the expensive stocks that were dumped in 1973-1974, almost everything crashed. The entire stock market is always based on the quicksand of human perceptions and emotions. I read Mr. Malkiel's book a great deal of skepticism. IMHO, the market is random (or maybe chaotic, not the same thing) most of the time, but it occasionally becomes directional. Tuesday's move was an example of non-random activity. BTW, Mr. Malkiel apparently doesn't believe his own book because he is involved in active money management using non random techniques. worth.com regards

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