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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 229.55

+0.2%

Dec 5 9:30 AM EST

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To: Glenn D. Rudolph who wrote (29335)	12/8/1998 6:46:00 PM
From: KeepItSimple	Read Replies (2) of 164684

Found out the secret to skyrocketing internet IPOs on CNBC today. Once again, I missed the obvious by assuming the average retail investor had at least a _shred_ of common sense. According to some market research firm, only 25% of trades entered through online brokers are limit orders. Everything else is at the market. They discussed the problem- basically online brokerage accounts dont explain basic things like limit and market orders, and all of these newbie internet investors trying to buy IPO shares have no concept of a limit order at all. All they know is "buy and sell" CNBC also showed that the vast majority of internet stock trading is done by small retail investors, due to the tiny blocks traded. Yes, you can all see this coming. What do you get when you combine legions of newbie internet retail investors who don't even understand the concept of a limit order, mixed with unabashedly greedy market makers, and even more greedy underwriters who price a stock at 9 dollars? You get a bunch of people who just bought a 90 dollar stock. Apparently there are so many complaints from clueless retail newbies that the Nasdaq has set up a special panel to investigate ways to inform investors about basic market practices. Then the quote of the day came when Mark Haines snickered and said something to the effect of "Anyone who puts a market order for a 9 dollar internet IPO deserves what they get." Couldn't agree more. I suppose this craziness will eventually end- but with roughly 50,000 new internet users signing up each and every day, it truly seems that there is an unlimited supply of greater fools. Could go on like this for years. Or at least until they run out of cash.

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