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To: Eric Jacobson who wrote (11660)	12/1/1999 7:18:00 PM
From: Mike Buckley	Respond to of 54805

Eric, About valuation. Not to worry. You'll never, ever get me to shut up about valuation even if I'm the last person on the planet who uses the V-word. You're right that valuation is mentioned in the manual, but it's nothing more than a mention despite the volumes of paragraphs and graphics used to describe it. The valuation Moore discusses is the valuation of the CAP using, in essence, a discounted cash flow though that's not exactly how he describes it. The problem with that -- the part that is conveniently left out -- is that 1) the risk-adjusted rate of return is never quantified because that's a decision each of us has to make as an analyst and 2)the point in time that the CAP ends by hitting the brick wall (the new, disruptive paradigm) is not defined because each of us needs to decide for ourselves when that will happen. You are probably aware that a rather narrow range of assessing those two quantities (the discount rate and the length of the earnings stream in pure cash-flow terms) yields a hugely wide range of results; the results rarely give an investor particularly helpful information in my opinion because the assumptions can be so wrong very easily. Moreover, there is an interview over at the Fool in which Louis Corrigan asked Tom Kippola about quantitative valuation. In that interview Kippola clearly stuck to his guns that the best valuation, in his mind, is to know where the company's product is in the technology adoption life cycle. My point is that the co-authors show no effort to help investors quantify value, which is pretty consistent with the sign of the times in this precedent-setting bull market. Just my opinion, but not humbly stated. :) --Mike Buckley P. S. I am counting on you to continue ranting about valuations. :)