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Strategies & Market Trends : The Stock Market Bubble -- Ignore unavailable to you. Want to Upgrade?

To: Tommaso who wrote (3177)	5/20/2000 9:59:00 AM
From: Dale Baker	Read Replies (1) \| Respond to of 3339

If we are changing our frame of reference based on mistaken bubblemanias, what frame of reference should we use instead? The standard that prevailed sometime before? When and why? It's like the "good ol' days" - lots of folks say they exist but no one can ever quite point to a golden age that wasn't as full of flaws as today. When tons of folks say the market is "overvalued" all they can point to is a PE or other multiple from the past when many of today's leaders were unknown or didn't exist at all. My trouble with that analysis is that anyone who followed it religiously - avoiding overvalued stocks since 1997 based on 1996 or earlier standards - essentially lost money by underperforming the markets. The traditional frame of reference is right and "wrong" at the same time. I am more comfortable with my own analyses if they produce better results over time (which they have since I began investing on my own). I get the impression the market is overreacting to the earlier runup by shooting everything in sight. But herds run hard and fast when a mania strikes - up and down.