Curbstone:
I wasn't trying to be hard on you. Spinach may not taste good, but it's good for you...
As I am sure you recognize, the stock market can be a very fickle mistress. She doesn't care whether your misconceptions derive from playing Monopoly, misinformation, greed or bad parentage. When she turns on you, as she invariably must (have we all forgotten last summer's baby bear market?), she will take your money and laugh at your pain. In down markets, ONLY FACTS matter. Stock splits, stock charts, relative strength, other technical analysis mumbo jumbo will not save you if you paid $2.00 for $1.00 worth of assets.
People have come to think that stock marketing investing is 'fun' and 'easy' and virtually riskless. When you make money on a daily basis, it is seductively easy to conclude that one's investing brilliance, rather than luck, is making you rich. Arrogance, ignorance, greed and a big ego can, and will, prove financially lethal...believe it or not. Right now the warnings go unheeded. Right now those who speak in cautious terms are viewed as obsolete; incapable or unwilling to stay in the game and reap the riches that EVERYONE IS ENTITLED TOO... Surely Irwin Fischer is spinning in his grave.
In a bull market, stocks go up for a myriad of reasons, some hopefully predicated on positive fundamentals. A stock split, anyway you slice it however, is a fundamental non-event. Those who say otherwise are opining on market psychology rather than economics. In a bull market, when everyone is excited, and into playing the game, a split is viewed by the unsophisticated as a positive event, and by the cynical as a way to capitalize on the unsophisticated. Fine. Just remember, in a bear market, stocks can go down...a lot...they can go down despite great earnings, wonderful, enthusiastic press release and otherwise terrific corporate performance. Stock splits won't help; neither will a lucky rabbit's foot or a positive chart formation.
We have gotten this far with Qualcomm because the company has spectacular fundamentals, wonderful management and a very bright long-term future. Stick to the fundamentals; understand what the business is worth and why. Then, if a bear market comes along, you won't panic and sell at the wrong time. Enough pontification from me!!
Best regards,
Gregg |
