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

To: BDR who wrote (24197)	5/4/2000 2:23:00 PM
From: IngotWeTrust	Respond to of 54805

Russell sez: What does my family's association with gold mining (my paternal grandfather was the chief electrical engineer at a S.A. mine) have to do with my investing acumen? About as much as the earlier poster's "posturing" as a "gold bug". That is to say, nothing. Sad sad sad... Can't even A) see the parallels between his heritage and his current financial interests and practices... B) resist a swipe at me in what was otherwise a very fine post, even tho' he had to go to an Australian gov't sponsored website to try to find something illustrative of his ancestor's skillset in "neighboring" South Africa. As a practicing gold hydrometallurgist, my honorable profession as well as my association with the most gorilla of all investments...i.e., the open architecture of physical gold, needs no defending. Physical gold has been very very good to me and my family across many generations. Furthermore it forms the basis of my ability to diversify into paper equities and my leisurely pursuit of G&Ks. For those who would like to see those I "hang out with" and am pleased to find my expertise and scholarly work listed alongside: click: elsevier.nl This database is currently free to search, but will be made available to scientific community, professionals such as myself, and libraries shortly. Here you will find a selection of me and my peers' abstracts etc., on my field of expertise. What does this have to do with finding G&K investing candidates--topic of this thread? Not only does a look at a concept's "history" help keep the current investment choices in perspective, it helps further understanding such mind boggling technologies as are provided by examining genetic engineering sector, for example. There was a time that genes were considered a garment<g> Doesn't it bother anyone besides me that G&Ks candidates are "seemingly" only considered worthly of either discussion or investment in by this thread if they are somehow involved in current faddishness of info/tech? While persuing same has yielded quantum results financially, there's a whole big world out there using said "info/tech" to inseminate other "gene-pools" and many of THOSE sector candidates are certainly "pre-tornado." Sector allocation should be of a concern to all running a personal portfolio. Of those submitted to this thread, I'd challenge one and all to go to snas' survey results and identify the variety of "gene-pools" represented by thread participants. If one wants to replicate said enormous returns by allocating investment funds in G&Ks, I sincerely suggest one critically think outside the info/tech box and diversify. And Mr. Grandson's recounting of a rock pounding S.A. miner was a refreshing lesson in valuable step back perspective applicable to all G&Kers! Selah.

To: BDR who wrote (24197)	5/13/2000 1:10:00 PM
From: BDR	Read Replies (1) \| Respond to of 54805

Valuation I - From the GGList Subject: [gglist] RE: Will Wall Street ever overvalue a gorilla? Date: Sat, 13 May 2000 10:23:40 -0700 From: Geoffrey Moore <gmoore@exchange.chasmgroup.com> Gang, In the book, we argued no, but I have to say that the Internet early market enthusiasm in investors probably carried all stocks too high, so that the answer now may well be yes. Here's what I think is happening. As the Internet stocks soared, investors began to use them as a benchmark for relative valuation. That is, if company A is worth X, then company B has to be worth Y (where Y is some function of X, as in 2X or 0.5X). As long as the comparables were traditional P/E stocks, this form of relative valuation was going top always undervalue gorilla stocks. But when the Internet stocks themselves became benchmarks, so that if we said "since Amazon or Yahoo or eBay is worth X, then Cisco, Microsoft, or Oracle must be worth Y," I think we entered the "over-valued zone." Once again, the key thing to remember about the market is that it focuses on getting relative valuation right and lets macro effects correct for absolute valuation. In both cases above there is an "error" in the relative valuation lens -- traditionally causing it to be too low, currently (I speculate) too high -- but in either case, the pecking order established by the lens is right, it is simply the distances between objects that is distorted. So what? I think this brings us back to traditional gorilla game theory which says, once the correction settles out (and then I would wait ninety days to let it start to come back, because I have a fear of false bottoms) and the market starts to come back, the relative valuation lens will have been "cleared," and my expectation is we will back to using P/E stocks as a benchmark, and the old dynamics will apply. In the meantime, this would be a terrible time to sell a gorilla. As for all the other stocks that may be in your portfolio, the gorilla game argues that gorillas should outperform them. We shall see. Geoff Geoffrey Moore Chairman, The Chasm Group 411 Borel Avenue, Suite 550 San Mateo, CA 94402 Valuation II - Cisco from Lightreading lightreading.com Everybody's favorite game this week seems to be "name Cisco's real value," and the results do not look good for the world's second-most valuable company. Cisco Systems Inc. cisco.com shares continued to fall throughout the week, even after a solid earnings report. The slide started on Friday, after Cisco announced its $5.7 billion acquisition of ArrowPoint Communications arrowpoint.com. Over the weekend, an article in Barron's barrons.com, the eminent bear of the financial press, grabbed headlines by pointing out the high price of Cisco's stock. Cisco stock is trading at an exorbitant price/earnings ratio? What a surprise! The company has been on an acquisition spree that's dilutive to its share value? You don't say! These tidbits of insight are about as fresh as the fruit cocktail on a Las Vegas buffet table.