Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : Booms, Busts, and Recoveries -- Ignore unavailable to you. Want to Upgrade?

To: excardog who wrote (212)	10/25/2000 5:47:34 PM
From: Stcgg	Read Replies (1) \| Respond to of 74559

CRASH UPDATE - darren.lib.utah.edu This is it, man, a disaster of Biblical proportion.. Real wrath of God stuff, fire and brimstone raining from the sky; rivers and seas boiling, 40 years of darkness,earthquakes, volcanoes... The dead rising from the grave, human sacrifices, dogs and cats living together.. MASS HYSTERIA!!!! WHO YA GONNA CALL????? >><<

To: excardog who wrote (212)	10/25/2000 7:30:36 PM
From: Erik T	Read Replies (1) \| Respond to of 74559

feels to me like the sellings just about over. My feeling is we are just starting to get into the real selling. It appears to me that the speculative bubble has been pricked; that is, investor confidence is weakening. Before any P/E was acceptable as long as the story was good. Once enough people had been burned by owning too many high-priced internuts, the setting was set for a significant downturn. The money just kept slopping around from tech sector to tech sector with some financials thrown in for good measure. What I think we must now confront is a weakening investor confidence (stocks don't just go up!) coupled with slower growth even in the high flyers that were supposed to log incredible growth into the hereafter. Add to that consumer and corporate debt are at all time highs by just about any measure (relative to GDP, absolute numbers). Also, margin debt is at all time highs as well (in absolute terms, not relative to overall market capitalization as it was higher in the last 1920's). And, inflation is accelerating by many measures which portends higher interest rates which act on equity prices the way gravity acts on matter. Keep in mind that just two years ago the NASDAQ was in the neighborhood of 1,500. My guess is 1,800 on the NASDAQ within 2 years. Just my thoughts, Erik

To: excardog who wrote (212)	10/25/2000 7:48:20 PM
From: Erik T	Read Replies (1) \| Respond to of 74559

Oh yeah, I forgot to mention the upcoming margin calls and the start of a liquidity crisis that for now has crippled the high-yield (junk) corporate bond market. And another note about earnings. Without continually rising stock prices, companies will have less tax benefit from writing off employee options, which if I remember correctly from a Barron's article, accounts for some 30% of Cisco's EPS. All of a sudden, even bellwether Cisco has NO GROWTH. When/if panic sets in, it could get ugly fast. I think the bulls will defend NASDAQ 3,000 vigorously and if we break below that it's over for this time around. Erik