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Technology Stocks : METROMEDIA FIBER NETWORK (MFNX) -- Ignore unavailable to you. Want to Upgrade?

To: PaperChase who wrote (590)	9/24/1999 6:05:00 PM
From: Cesare J Marini	Respond to of 1983

Paper, With the coming market dip I will be tempted to pick up some of these stocks on a 30% dip from today's prices. MFNX might not get that low. We're forming a double bottom here, and MFNX is already 50% off of its high. A further 30% would put us at about $16. I'd be a happy buyer there, too, but it may not get that low.

To: PaperChase who wrote (590)	9/24/1999 10:09:00 PM
From: ahhaha	Respond to of 1983

You're making a collection of mistakes. The most grievous is that I or anyone can know where stock prices are going. Associated is that if I got it right the first time, that I have any more chance of getting it right the second time than anyone else. Track record will bag you. It's a reliable error of the big line gamblers. They always look for whomever is hot. The second mistake is to buy on the way down. Similar to that is bottom fishing or picking. If you want to know what a disaster buying at the "bottom" or in a base can be, just check out ODIS. The third mistake is that you have to own it. No you don't. You have to identify the fact that you have been sold and then get suspicious of your naivete. Right attitude is you don't need to own anything because it is very likely to lose. It has to look somewhat bad to buy and it has to have been looking bad for some time. Then you have to see something which the market has chosen to ignore about the company. There has to be a series of constructive company developments in your judgement, not necessarily anyone else's, where you feel indignation that the Street ignores the company. Nonetheless, you stay out until the Street starts discovering what you have guessed would come. Then you buy some chunk when it comes out of the base hopefully at a top with Wall Street fanfare. You don't buy any more until the company proves it isn't a flash in the pan. That is proved when you buy another chunk higher than the previous one. When you're buying at tops, know you're on your way to success. The fourth mistake is, "With the coming market dip I will be tempted to pick up some of these stocks on a 30% dip from today's prices." This is precisely the psychology that the market will bust. The market ripped a lot of hot shot pros who had the above attitude by its late day swoon yesterday. They are learning that the bull market is over. They should have realized that many months ago. That's the nature of the bear. You say the market will now dip. It may, but far more likely is a short term bear market rally which will reverse the bearish psychology briefly. Such psychology is only a product of yesterday's price. You will see all the public back in there gambling up a storm and you will completely forget that the bear is lurking to rip again. This is how the machinery finds value in the market, by ripping the public to shreds. My guess is that MFNX is going to rally back up to 28 and change. It's just a guess. It is not possible to know what it will do in advance. That's why someone short would have covered today and would then be sitting on the sidelines to see what develops. If the stock rises and if it does what is necessary such that the appropriate shorting characteristics are in place, then you go short. You don't have to. There are many far better short sale candidates in the market. MFNX has to get up to around 30 for it to even be vaguely worthwhile because the down side potential is maxed at around 15. You have to decide what you believe the company is worth. Then you have to guess future interest rates. The reason is that company valuation will become more and more sensitive to rising interest rates which are the harbinger of inability to achieve projected profitability. That means you have to get hard-nosed. Expect the worst. Expect this level of rates won't slow anything down. Expect the FED doesn't want slowing. The true market bust won't occur until the FED has to raise rates whether they want slowing or not. If they don't which last occurred in 1980, the market will take over and do it for them. In light of that you take the "Missouri Attitude". You assume it will base and you wait, wait, wait. If it just takes off and leaves you in the dust, so what? There are always better plays available. Got that? That's the best advice my more than 30 years of unequalled experience can give you. You don't have to own anything.