Hi, Darkgreen,
I feel some need to reply to your post, although I realize it was mostly the occasion for a reiteration of your earlier points. Of course "some painfully apparent questions...remain unanswered." Duh! I take your later questions to be rhetorical under the circumstances. However, the reference to circularity puzzles me; you must have meant something else. I was simply distinguishing price movements owing to substantive changes in the company's circumstances from price movements owing to rumors. And that, in brief, was my whole point. The sharp move of the stock price from $8 to $11 to $8 was not evidence for the arguments of either the longs or the shorts, at least in my view. I was not "trashing a counter view for gloating," nor was I rebuking, although I will admit to a bit of gentle teasing in the course of making my distinction.
I will also admit I was not clear about the timeframe I had in mind. To be specific now, I think there were substantive reasons for the rise of the stock from the $4-5 area to the $7 area: huge insider buying and the appointment of the chairman of MCI-WorldCom to the board. I don't see anything similar behind the run from $8 to $11 and back. I attribute it entirely to buying on the rumor and selling on the news (which was the lack of news). It says nothing about the substance of the company. On this basis, neither the longs nor the shorts had substantive reasons to gloat during the move. (I refer here only to investors; traders who have scored by betting right on quick price moves are entitled to gloat for their own legitimate reasons.)
Finally, in these times trying both for the longs and the shorts, I have no problem with people gloating a little when things go their way. The enjoyment of small triumphs has its place when you face the possibility of hanging. I just think it is useful to keep in mind, while you gloat, that the final verdict is still out.
Regards, lws |
