Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: Frank Ellis Morris who wrote (21742)	6/13/1999 6:15:00 PM
From: RocketMan	Read Replies (4) \| Respond to of 41369

Well, I may be right or I may be wrong, but here is how I see the situation: 1. Internets are either for the short term trader, or for the long term holder. Short term you can make money on the wild swings, long term you can make money on the economy of the next century, which is just now beginning. If you are an intermediate holder, however, it is extremely difficult to hold through times like these, and you will likely sell at the bottom. 2. Anyone investing in internets has two choices: roll the dice on a company that might become the next leader, or invest in a leader. If you roll the dice, you might win big, but it is more likely that you will lose big. If you invest in a leader like AOL the appreciation will not be as high, but you are betting on the underlying paradigm shift from brick and mortar to e-commerce. If so, and you are a long term holder, you should hold until you lose faith in AOL being a leader and you find a new leader. 3. The price drop over the last couple of months is 99% psychological. Inflation is not here, it is the fear of inflation that is here. But even if inflation were to arrive, that is not the end of the stock market. Deflation is a bigger worry, something we had the beginnings of last summer. Interest rates are going up, but I don't think many small investors are cashing out their stocks in favor of CDs. 4. Nothing bad has happened to AOL. The price drop started at the last earning report, which was great. Broadband has been discussed over and over, and it is not the problem, even ATHM has dropped a great deal, even before the Oregon ruling. Trailing p/e is meaningless for an industry of the future. And forward p/e needs to be looked at in a five year timeframe, not next quarter or next year. 4. As much as I like TA, the selling seems to be systematic, probably from big houses selling a bit at a time, and I don't know if TA really works that well in these situations. 5. Once the summer rally starts (which may not be for a while, or even Fall), AOL will be one of the first to recover, and many will look back at the bargain prices they got this summer, just as it happened last summer. 6. I still have a target of 150 by year's end, FWIW. BWDIK

To: Frank Ellis Morris who wrote (21742)	6/13/1999 6:19:00 PM
From: Tom Tallant	Read Replies (2) \| Respond to of 41369

Frank, I enjoy reading your posts.They are thought provoking and reasoned. Here is what I'm trying to figure out. On Friday I saw no less than 5 large buy block trades between 3:15-3:45. The largest was for 600,000 shares at 100 1/2 - the smallest was for 25,000 at 99 7/8. What gets my attention is not so much the trades but the day and time of the trades. Some fund ( I presume it was a fund) invested over 60 million dollars on a late Friday afternoon when the 30 yr. bond was hitting at 17 month high. Don't get me wrong...I am more than aware that fund managers can be as wrong as anybody but I thought it was fascinating that they have that much "money were your mouth is" confidence in the stock at this critical juncture. Just a thought, and believe me...I haven't got a clue where we go from here short term and frankly I don't think TA is much use in this kind of environment but I fell comfortable that my long position will be worth much more by year end. Best Regards, Tom