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Pastimes : The Justa & Lars Honors Bob Brinker Investment Club -- Ignore unavailable to you. Want to Upgrade?

To: Mr. BSL who wrote (12332)	3/8/2000 5:35:00 PM
From: Allan Harris	Read Replies (1) \| Respond to of 15132

Re: DJBB gave a double bottom SELL signal today Yes, Dick, a lot of angst around, and the DJBB Sell doesn't help matters. On the other hand, for some perspective here are some thoughts from "Denny" who is a regular poster at the Gilder Technology Report subscriber forum: "Investing is not all that difficult if you manage to get rid of the noise. Somehow, money generates incredible amounts of noise from shysters, pump and dumpers, news media, pundits, experts, funds, newsletters, fora :), and what not. The secret is to get rid of the noise. I find it ridiculous that there are more funds than underlying stocks. How can it be easier to filter funds than to filter stock? At least, in stocks, you know what they do! There are two main noise filters: "You have to reduce 8 or 10 thousand stocks being traded on the various exchanges to 10 to 20 that you want to invest in. Gilder and Navellier are very good filters, each in his own very different way. If you take Gilder's 30 plus a few that you unearth yourself, then you only have to prune 40 to 50 stocks down to 10 or 20. How much simpler investing becomes!!!!! "Then, of course, you have to know how to choose the 10 or 20 from the 40 to 50. Here your best course of action is to learn investment rules. Write a story for each stock. Listen to people like Peter Lynch and Warren Buffet who have made a bundle in the market. Ignore all the bullsh*tters with fancy theories and glossy newsletters who do not make money ?consistently? in the market! What Lynch and Buffet say is simple. For me, the second most important rule is that the value of a stock is the discounted present value of all future cash flows. This justifies the "ridiculous" P/E ratios of most of my picks. "They have not only discounted the future but eternity" is a common saying among old time investors. The problem is that they have not plugged the numbers into a spreadsheet. You translate rule number two into practice by buying stocks with growing revenues and earnings, the faster they grow the more they are worth. The first most important rule is that buyers and sellers set stock prices. That means that companies must send out clear signals that even gurus and pundits can understand. GBLX's price drop, when the US Worst/Qwest merger situation came up, was caused by the total confusion created in investor's minds. Today there are so many individual investors on the internet that it is very difficult for "professionals" to manipulate stocks that have a certain volume. This keeps me out of stocks with very small volume and stocks traded on the bulletin board. So, rule number 3 is, keep out of the way of shysters. Last, rule number 4, there is no need to be the first kid on the block to make a good buck, on the contrary, let others figure out the situation for you. I posted the "First Kid on the Block" post on account of the Clue frenzy caused by GG's mystery company. Guessing the mystery company will not make me any money. But I did act on GG?s warning that "spectrum buyers should be worried." I sold NXLK. In this game of Clue, the mystery company is the noise and the warning is the signal!" A