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

To: Uncle Frank who wrote (34055)	10/30/2000 10:12:34 AM
From: Bruce Brown	Read Replies (1) \| Respond to of 54805

I forgot that you and Aunt Nancy were on the 'road' and enjoying life. Yes, the Project Network is derived to see if we can get a handle on the 'network effect' which we know our dominant gorilla companies enjoy. I believe that including Yahoo! in the project is a good, if not one of the best examples to show how this applies to a godzilla. In terms of length, your comments are certainly noted and all of us that are preparing reports can perhaps take that into account as we gather our information and present it. More can always be said and added in the discussion that follows if need be as we move through the reports. I actually worked on my i2 Project Network report in the car this weekend as we drove up to spend the weekend in the woods for our annual rabbit and deer eating festival at a lodge. I need to get out more often, as living in the big city doesn't allow me to see the stars at night like I experienced with my two children this weekend in the clear night air of the country. That and a simple activity like flying kites and making model boats out of dead tree stumps to race in a river filled our time this weekend with the kids Shame on me for forgetting to do those kinds of things more often. BB

To: Uncle Frank who wrote (34055)	10/30/2000 12:53:42 PM
From: StockHawk	Read Replies (1) \| Respond to of 54805

...an amorphous body of enthusiasm mixed with high pressure selling. Project Hunt taught us the value of objectivity and structure. That's an excellent point, Frank. And it is something I think we should take more time to consider. Unfortunately, enthusiastic advocacy is often a component of investment research by us amateurs. The reason is quite simple. Doing extensive research and analysis on a company takes a lot of time. Few people are going to do such work on a company that they are not interested in. Most of the time, the research is done not only on a company that interest the person, but it is a company that the person has an investment in. The perhaps subconscious motivation is to prove to ourselves the validity of our investment and to get others to see it. It is a difficult problem to overcome, and increasing awareness of it is the first step. The second step is to identify the areas where "rose colored glasses" do the most harm. Those would generally be the subjective areas. Hard numbers, following a format, are harder to misdirect. Metrics like ROE or ROIC or flow ratio or YOY sales growth can help a report to be more objective. I also think it is problematic whenever someone investigates a single company. More clarity can be provided when two close competitors are analyzed and compared. We saw the value of this a few months ago when Bruce provided some quantitative comparisons between CSCO and LU. Just MHO. StockHawk