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Strategies & Market Trends : Gorilla and King Portfolio Candidates -- Ignore unavailable to you. Want to Upgrade?

To: Seeker of Truth who wrote (20299)	3/16/2000 3:24:00 AM
From: Yamakita	Read Replies (1) \| Respond to of 54805

[delurking momentarily] Malcolm's point about the dearth of engineering talent is an excellent one. Right now the pattern seems to be: the higher the growth in a company and the better its prospects, the more it attracts the top people. If the top growers sweeten the pot with a piece of the early action through the award of options, the pattern just gets faster and more entrenched. People like to own pieces of things they're involved with: it motivates them much more than just getting a relatively fat salary, sans the piece of the pie. For better or worse--and I think better for just about everyone reading this, especially those who've invested in the gorillas that are the focus of this thread--people work harder and smarter when they're "incentivized" to do so.And this, as Malcolm said, tends to lengthen fast-growth period, which adds even more firepower to the companies and to their stock. The fastest growers get this, big time. And that's how they get the really smart, really hard workers, the Silicon Valley cowboys/girls who are so gung ho to put in five years or so of pretty much nonstop work during (ever-increasing) waking hours. They didn't do that in the sixties, seventies, and early eighties. The whole thing was much more genteel, more staid, more predictable. The Wild West aspect of the market today is really fascinating to me. What Stanford MBA students talk about now is not, cannot be, what they talked about before all this started. (not that I really know--I haven't set foot on a campus in a long time--I'm guessing) Careers that used to span 30 or 40 years now span in just a few years. And if you make it, like so many entrepeneurs in the Valley have, you can always just sell out and go do it again. (Michael Lewis's latest book, The New New Thing, describes this process memorably by looking at Jim Clark's adventures, but there are tons of other examples) So the speed of it all is one aspect that it seems to me many people/analysts/SI people miss--how rapidly this whole New Economy is shaping up. As Kumar and tekboy just noted above, these 10 percent corrections seem sort of laughable if you've been invested in gorillas (and their kin) the past year or two. But they cause real, if temporary, pain for those who just showed up on the scene, and bought the Q for 200 or JDSU 150 a few weeks/months ago. It's an unforgiving environment if you're just hopping in, and can't really afford the losses--paper or otherwise--you've just been whacked with. It's tough to do valuations in this environment. Those who've coughed up the dough for the growth have been the winners so far, but they've sort of had to hold their noses while doing so, especially if they've been around a while, and thought they had a pretty good handle on how to value things, especially those taught the gospel by the masters like Graham/Buffett. Sorry for the rant. Oh, and another vote for a tekboy weekly roundup! Yamakita