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Non-Tech : Tulipomania Blowoff Contest: Why and When will it end? -- Ignore unavailable to you. Want to Upgrade?

To: Cheeky Kid who wrote (2587)	1/26/2000 6:56:00 PM
From: Mad2	Respond to of 3543

Actually box prices have been reported as rising the past two months. How much of DELL's problem is related to JIT inventory (remember they beinifited greatly when component prices were dropping) and rising component prices (although spot dram for certian configurations is reported as soft) and/or due to processor shortages. Or as you suggest is this due to corporate slowdown (DELL's strength) due to lockdown. The interesting part of this will be to observe stock price behavior of a growth story (DELL/QCOM), when the growth slows down and is excerbated by margin difficulties. I think the theme of bearish thought on this thread is that numerous tech stocks (eg tulips) are valued based on high growth and cash flows that are forcast out 3-5 years. Given the state of our current economy, record unemployment, with a low savings rate hyper consumer spending and having benifited from a recession (now turning around in oil) in commodities the bearish view is predicated on the belief that these trends can't continue in favor of growth and when they turn it could get ugly. Granted the buy and hold anything growth oriented has worked quite nicely...since Oct 98....yet investors who think this will continue stand to get creamed. I'd add that with the advent of individual investing facilated through low cost online trading, volatility has increased greatly due the ease of entering and exiting positions. If one turns back the clock when equity prices were influenced more by institutional and fund managers we didn't see the unrealistic valuations that have been created by the rush of money chasing tech stocks, in part caused by a less diciplined approach to valuing equities. If too many attempt to hit the exits, coupled with record use of margin, it could get ugly......fast. Bringing truth to Mr. Greenspans words of irrational exuberance, when the NASDAQ was 1500 and the Dow was 7500. While I have a bearish bent, reflected in my investment style I'm not sure I want to see that come to pass.........but it is a possibility. Best Regards, Mad2