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To: y2kate who wrote (41664)	11/28/2000 11:00:47 PM
From: Perspective	Read Replies (1) \| Respond to of 436258

I'll warn you straight out - I am already preparing to nibble at some growth stock funds. Back when it became obvious that 5000 was THE top for NASDAQ, I identified a 50% retracement as the first point I would become interested in buying stock. I based that largely on looking at plots of other bubbles that burst. Review Japan's Nikkei in the 1990s, and our markets in the 1930s and 1970s. I'm not certain it's going to get that bad, but even in those declines, a long-term player achieved average market returns over 10-20 years by purchasing at a 50% discount from the top. And since I'm not certain that I know 100% of what is going on, I'll probably play the statistics and begin nibbling. That said, I'm nurturing a broad short portfolio, built on an accumulation of every bad idea or game I saw employed during the bull. If it was stupid, I'm fading it. That means I'm short i-Nutz, data storage stocks, semiconductors, superconductors, fuel cells, biotech, and any other imagination stock that was bid up by people who didn't understand the huge risk to capital invested in them. For a complete list, sift through some of my recent posts. On many days, I've posted several of my thoughts. Allan is also an excellent trader; I can strongly recommend his talents. I need to run right now, but I can show you some of my hand later. Unfortunately, the easy money has been made in most of them. Some, like RIMM and RMBS, are just starting their failures. But many are risky shorts here, and I am starting to cover them. Shorting is an incredibly difficult strategy. While conceptually it is just like buying a stock and then selling it, only in the reverse order, the leverage mechanics of a short portfolio take a while to get a good feel for. While a 100% long position involves no risk of forced exit from the position, even a 50% short position can be run to uncomfortable debt/equity pretty easily. It took me a very long, painful time to learn it. It takes a great deal of maintenance, thanks to the large number of bulls that specifically target short-sellers, even the short-sellers that might be right on the long-term potential - or lack thereof - for the company. BC

To: y2kate who wrote (41664)	11/28/2000 11:26:18 PM
From: Charles P. Hubbard	Read Replies (2) \| Respond to of 436258

y2kate, "too late to go short" ;there are still stocks at unrealistic valuations to consider. How about PAYX at or near the all time high, with a PE over 100 and PEG of 3. They are a payroll and administrative processor for small and medium companies. What happens to their revenue growth when their customer companies start laying off workers? Take a look at the fundamentals and the chart and see what you think. A good company to be sure, but IMHO, the stock price will crack like so many other high-flyers. FYI, I just went short. CPH

To: y2kate who wrote (41664)	11/29/2000 2:28:19 AM
From: chic_hearne	Respond to of 436258

Way past time to bail. Looking for a good short, but afraid I'm too late for that. I'll keep tuning in here for ideas. Until then, I'll stand pat and be grateful for what I've managed to keep! I would look at INTC, CSCO, or MSFT. INTC- They haven't given nearly enough IMHO compared to the SOX. They are one of the most overvalued on the SOX. All indications are that PC sales are not materializing in Q4, but yet INTC has been relatively stable compared to everyone else who has got hammered. Also, they have crazy YoY profit expectations to live up to since they were able to muscle the ANALysts into including investment gains for the past few quarters. Their investments were in speculative crap that has been destroyed, therefore, YoY comparisons are going to be terrible no matter how good business is since they won't have the investment income. I consider this one very low risk. Any decent rally gets sold because too much smart money is looking to get out at a better price. MSFT - ditto for the same reasons at INTC. I consider this one a little bit more risky since you never know what kind of irrational exuberance will develop if it is finalized they will be broken up and the street believes the parts are worth more than the whole. Or vice versa if the breakup is thrown off and this is viewed as bullish. Either way they are extremely overvalued and business for them is not good and the outcome won't change that. Every play on them I make I guard with calls just in case. CSCO - I consider this the true short and hold until the bottom. No other stock is more grossly overvalued IMO and I feel there is little if any upside risk. Any rally gets sold on them. In the bull run, there was no amount of CSCO you could be long enough, in the bear run, there will be no amount of CSCO you can be short enough. I plan to cover in the single digits on this one. Bear market rallies can be a bitch and all of these may go up more than the average should a short term bottom be hit, but if you short JNPR or AMCC or something of that sort, it could double in a few days on a monster rally. I would recommend taking the money for each 100 shares you plan to short and set that aside. From that, buy 1 put and save the rest as cash. That way, you aren't risking much capital should things go against you, but you are still getting the leverage of being short. Of course, I view it as absolutely insane to take investment advice from some anonymous person over the Internet, so good luck in whatever you decide to do..... the best advice is probably to just go 100% cash and come back in a year to play....