To All, Barron's review. An interesting issue, though the Mailbag section, usually my favorite, was weak this week.
1. Abelson takes several shots at the Internut stocks. Nothing new, but funny as always.
2. Alan Greenspan's silly, simplistic model that says that earnings yields ought to be equal to the yield on the 10 year note is again showing the market very overvalued. This is a nutso concept, as it takes no account of the much higher risk of corporate eps than of 10 year Treasury interest. Still, even by this very liberal standard, stocks are pricey.
3. An interview with former Fed Gov. Lawrence Lindsey who sees all the problems those of us on the thread see. He calls the stock market a bubble and thinks his buddy, Alan The Printer, is aware of it. He also believes that the printing of money is very dangerous and that we will see a huge crash in stock prices. All of this is great. However, his solution, more deficit spending through a tax cut, is the usual American Enterprise Institute pap. That, combined with the printing would make the dollar fall like the Carolina Panthers and make it more difficult to fulfill the role of importer of last resort, which is what he wants to achieve.
4. A big article on Merrill Lynch and how their eps may actually grow again some day. At a rate at least a quarter of its pe ratio. -g-
5. An excellent interview with Morris Mark. I last had dinner with him in Kansas City is 1980, when he worked for Morgan Stuckup. A very smart guy worth listening to, though I disagree with most of what he says. I absolutely hate his stock picks. But, unlike the "buy it because it is going up" crew, he at least tries to find some reasons to back his bad picks. -g-
6. The Market Watch section that covers newsletters and other shady activities, was intriguing. Only 1 bear out of 10 pundits. Pretty scary. The bear is Ray DeVoe. Even Will Lyons of Short On Value said to avoid shorting internut stocks. I agree with him. It is too dangerous. But Will is a bear, so I am surprised.
7. Insider buying at GZTC. O.K., one insider, but, hey, I'll take anything. -g-
8. The Plugged In column tries to derive some values for other internet cos. based upon the AOL deal with Netscape. Golly gee, by that standard, none of these stocks look like major bargains. -g- However, I disagree with the measurement tool. Netscape carries a lot of baggage that others do not.
9. One good letter in the Mailbag section under Wake Up Call. A former accountant discusses the relationship between co. reports and science fiction. Nothing new, but it is nice to hear others say the same things.
10. There is a new Internet option symbol DOT that is an index of totally internet plays, no Ciscos or Microsofts. I plan to check it out.
Good Luck,
MB |
