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Technology Stocks : Aware, Inc. - Hot or cold IPO? -- Ignore unavailable to you. Want to Upgrade?

To: Perry P. who wrote (8413)	4/13/2000 8:49:00 AM
From: jghutchison	Read Replies (1) \| Respond to of 9236

Perry, Great post. Nothing like rubbing salt in an open wound. Look for the bounce today. Nasdaq futures up. Jack

To: Perry P. who wrote (8413)	4/13/2000 8:50:00 AM
From: Jess Beltz	Read Replies (2) \| Respond to of 9236

Perry, I agree completely, and believe especially that the AMD news bodes well for today's (at least) action. I don't know whether or not this signals an end to the correction. I have never seen the market act as irrationally as during the last 6 months. Sound valuation principles have been totally thrown out the window. (1) Let's face it, many tech stock prices, particularly those based on earnings streams years in the future or fantastic earnings projections for web-medium companies were bid up way too high as a lot of investors (both mutual fund managers and individuals), using actual equity and a lot of margin threw money at the tech sector. (2) The margin situation was the one thing that I didn't really see playing into this, but I think it has, in that the use of margin forces one to trade, and forces one to take profits at an accelerating rate as prices fall, which of course translates into more selling pressure, and further accelerates the downward pressure on prices, etc. and you get a real-time chain reaction in the financial markets. I think you can see this day-to-day. I've noticed that the current typical pattern is for prices to run up early in the morning as the day-traders lay in their positions for the day (many using margin), and the sell-off begins about 2:00 as they start to close out most of those positions. (3) The thing that is really aggravating is that our firm, Aware, has a real earning stream that is definitely accelerating, and yet, by virtue of association, our share price gets killed along with every other tech stock. (4) Finally, you get 'market mavens' like Gail Dudad, Mark Maybeus, Flabby Cone, etc. with their broad-based calls that "investors should think about rotating out of techs and into old-economy stocks with real earnings," (like AMD doesn't have real earnings) which further exacerbate the decline across all tech firms, whether they have accelerating earnings or not. I'm fairly well convinced that many of the old Wall Street Gurus, who don't understand technology anyway and don't trust investing in a sector they don't understand delight to see the sector get bashed (along with all of the investors who do understand it and invest in it) and will do all they can to drive it down as far as possible. It may be a while before the Street has really savvy fund managers who research and understand the technology they choose to invest in. As long as we have to deal with old-school fund managers with billion dollar portfolios acting with the same degree of ignorance (or more) that a high school sophomore has, we can expect to see true irrationality. Add to that a segment of the population who prefers Wall Street to Las Vegas and you have a recipe for true wealth crushing volatility. Sorry for the rant. Jess