Auric,
#1 : I don't know when it will happen. But if it happens, it will NOT be because it is a Tulipmania Blowoff. It will happen because of a major unanticipated event that is not currently reflected in the stock prices. Some additional thoughts follow
THE VERY EXISTENCE OF THIS FORUM, and all the views posted here, guarantee that, to some extent, these scenarios are reflected already in the prices. So forget high PE ratios, no earnings, tax effects, etc.
People who talk about Tulipmania miss the extent of the fundamental sea change that is taking place with internet in retailing, distribution, dissemination of information, etc., etc. Are the high stock prices justified? Most likely they are overdone. But efforts to quantify by how much and to pinpoint timing are at best futile. Also a very good point that has been made in this forum is, that the AOLs and YHOOs of the world are going to be the last to correct (if such a correction takes place!)
Which brings me to my last point. If you look at history and look for events that have stop developments in their tracks, you conclude that it takes events such as wars or physical disasters. So, to add bit of spice to your forum, I would post a MAJOR EARTHQUAKE in California as an example of such an event that would bring about a blowoff to the internet stocks (war is not in the radar). Most of high tech innovation is coming out of California and a major earthquake there would have an impact that would go beyond the local effects.
My 5 cents (hoping to convert them into $3,500)
Tavros |
