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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Sarmad Y. Hermiz who wrote (64746)	6/26/1999 1:16:00 PM
From: Eric Wells	Read Replies (3) \| Respond to of 164684

I agree that discussion of fundamentals of internet companies at this point may be a waste of time - if brokers and analysts want to buy the stock, then the "elephant" institutional investors will stampede and obliterate those who are short such as myself. This is the risk in which I have placed myself in going short - and I do believe it is a tremendous risk (believe me, every day I hold my short position, I fear seeing a 30 point uptick at market open). However, at some point in time, a company's fundamentals do become important - and a look back over the years will reveal a number of companies that saw major increases in their stock prices due to unrealized promises of future revenues and profits - when fundamentals became important, these companies saw their stock prices decline. The question is: when will fundamentals become important for the valuation of AMZN and other internet stocks? We could have to wait another couple of years. There is always the risk, however, of a respected Wall Street analyst (Blodget or Meeker) deciding on the spur of the moment that fundamentals are important and releasing a statement indicating that on a fundamental basis, internet stocks are generally over-valued. I believe this would spark a massive sell-off. Of course, I don't believe that Blodget or Meeker will make such a statement any time soon. Mark Twain wrote of the 1860's Nevada Silver Rush in a book called Roughing It - the parallels between the Silver Rush and today's "Internet Rush" are striking. Twain writes of how miners would stake claims on land, open a mine, find a little silver (or salt the mine with silver) and get a lot of money by selling stock in their mines based on promises and speculation of large silver veins - the miners would then leave town with investors holding stock in worthless mines. The system worked for awhile - and in fact, for a period of some seven years, Virginia City (the heart of the silver rush) saw a booming economy with numerous paper millionaires. But eventually, the market crashed - and the crash came very quickly. And when the dust had settled, many people had lost a lot of money, the population of Virginia City declined from over 100,000 to a few thousand, and just one or two silver mines remained in operation - the mines that survived were the ones that had found silver and had kept producing silver from the very beginning. I don't mean to be inducing fear by relating this historical account - but I do believe the conditions are somewhat similar to what we face today with the "internet rush". And we are all trying to accumulate more wealth by picking those internet companies that we feel will survive - those companies that will continue to produce silver, or profits if you will, when the dust settles. Because when the dust settles, fundamentals will be important. My main concern with Amazon is that it has yet to produce silver. I'd appreciate any comments. Thanks, -Eric Wells