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Strategies & Market Trends : Market Gems-Trading Strong Earnings Growth and Momentum -- Ignore unavailable to you. Want to Upgrade?

To: Lane Hall-Witt who wrote (5499)	2/28/2001 12:11:09 PM
From: Dave Gore	Respond to of 6445

Lane, you response demands more careful reading. I'll check it out more thoroughly after hours.

To: Lane Hall-Witt who wrote (5499)	2/28/2001 12:40:48 PM
From: ChrisJP	Read Replies (1) \| Respond to of 6445

Hi Lane, what you posted is very similar to what I posted in December, namely the sign that big money is unwinding their large holdings. In this case the holding in question was CSCO. Message 15033360 I've also been saying for some time, what will the average investor do when they finally realize they could have gotten a better return from a money market fund than they could have from almost any index fund over the past 2 years ? Chris

To: Lane Hall-Witt who wrote (5499)	2/28/2001 1:13:18 PM
From: SirRealist	Respond to of 6445

Excellent perspective Lane; your re-valuation scenario added focus to that area especially.

To: Lane Hall-Witt who wrote (5499)	2/28/2001 9:40:05 PM
From: Dave Gore	Read Replies (2) \| Respond to of 6445

Lane, I hope everyone reads your posts, especially those who traditionally don't take the time to read anything over 3 lines long. Here is the link to one that I think is very "right on": Message 15424494 I think people need to understand your points. They especially need to understand PE/G and why some stocks still are very vulnerable, while others are not. Here's some additional feelings I have on the tech sector. I believe we've completed 1 wave and most of the second wave of the selloff in techs. The first wave, composed of the most obviously over-valued stocks, included the dot-coms and those weak tech companies like ETYS, Covad, and CMGI and all the others who were losing a ton of money and had a poor business plan. They eventually got creamed and justifiably so. Where we all had said a year earlier, "Why didn't I buy PCLN or YHOO or AMZN when they were "cheap", we all said in 1999, "Why didn't I short them? Analysts and Market commentators with decades of experience failed to adequately warn us of the dangers until it was too late. In some cases, that was by design. The second wave is composed of the relatively sound companies that were clearly overvalued. What is amazing here is how overvalued some of them got. Also amazing is how badly some really good companies have corrected. Look at ELNT and ARBA. They are actually profitable, yet down about 85% from the $120 level of not that many months ago. Of course many others that are not profitable are finally correcting. During the last couple years we failed to learn our lesson of the dot com bombs and overvaluation. We still placed too much emphasis on growth and "potential." We ignored PE's and even created the "PEG" to justify this overvaluation. OK, but then we ignored PEG, too. A PEG of 1.00 is a reasonable parameter. But look at RIMM. Will it grow earnings 300% this year? If so, it has a PEG of about 3.0 and if RIMM disappoints it may mean the current PEG is closer to 4 or 5 or even 10. After all, it is only expected to earn about 7 cents for the whole year ending early 2001. Of course, that makes the current PE about 900 and next year's if it meets consensus of 37 cents about 110. RIMM is just one example of why we are not done selling off some tech stocks. Even if RIMM does not get hit that hard, there are still many worse examples of overvalued companies that are still not making money and may not for some time. They still need to correct. Finally, will we finally have llearned our lesson after virtually all the tech stocks correct? I bet not. Can't you just see the Human genome stocks get driven up to even more excessive levels? You know, the stocks of the companies that won't make money until 2005 or even 2007 or longer.