Rob S.
Good analogy about your comparison of internet frenzy to that of the biotechs. I have started to hear this analogy recently from others as well; I have followed market for 12 years +, and it's the only thing that even compares to this, with regard to possibly obtaining clues as to how the future pricing and trading of internet stocks will unfold.
The most noteable difference to the internet vs. biotech craze though, is as you and others have pointed out; lack of barriers for competition to enter marketplace. This, I believe, will be what ends the speculative portion of this run much quicker than that of the biotechs.
When the dust settles, there will be winners, without a doubt; but my prediction is that the new found revenues from e-commerce will be spread around so widely that there will be few, if any, gorilla's...just a lot of new (and nifty) way's for consumers to spend their SAME AMOUNT of disposable income, with massive amounts of marketing dollars continuing to be spent by businesses to try and secure as much of our spending/disposable income for themselves. And the ultimate long-term profitability problem for these internet companies is, IMHO, that these marketing expenditures fail to create a "better widget", thus adding no goodwill to their future earning potential, unlike the R & D expenditures made by INTC, LU, CSCO, etc.
But now I sound like a long term investor, of which I am generally not; not that it isn't a sound investment strategy, as many I'm sure will attest that it is. It's just not me.
wildbill |
