Hope this isn't a reprint. FWIW:
March 4, 1999
Market Rap with Bill Fleckenstein
Dell deal inspires melt-up madness
The big news this morning in New York, thanks to CNBC's Maria Bartiromo making something out of nothing, was a Dell (DELL) and IBM (IBM) agreement that in essence calls for Dell to buy hardware from IBM - a total non-event. I haven't yet determined whether it's an exclusive agreement. But if it is, that's a negative for Dell because the Korean parts tend to be cheaper. It's not any kind of a service contract; it is just a pure hardware contract.
Dumb and dumber... This created total euphoria over nothing, which is to say that a complete hype job got the stock market rockin' and rollin.' It had Dell up close to $5 and IBM up almost $10. A bunch of the semiconductor vendors and component suppliers also were up a ton. You'd think that if this were such wonderful news for IBM it might be less wonderful for the other guys, but that's not really the point here.
So, stop the presses. The Dell-IBM deal is the functional equivalent of Ford buying tires from Goodyear. Is this the kind of thing that should cause a complete melt-up in technology and the stock market? It reminds me of the Jim Carey movie "Dumb and Dumber."
Follow the bouncing ball... It just goes to show you that this continues to be not about investing, but about pure and total speculation. And at every juncture it is aided and abetted by Maria's cheerleading, who this morning was bouncing like a Ping-Pong ball between posts. This is not to pick on her specifically. It is just to point out that the enthusiasm with which news is reported incorrectly only foments more speculation, and it only serves to make an unstable environment even more unstable. That's really the moral of the story. Maria happens to be the person doing it, but if it weren't her, it would be somebody else.
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