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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (52166)	4/26/2001 9:02:42 AM
From: GVTucker	Read Replies (1) \| Respond to of 77400

Mucho, RE: i would call this argument erroneous in composition. "long term" is defined as the 1990s, which was an extraordinary decade for high-tech stocks. a whole generation of investors is brainwashed that this is the only type of market that can exist. it is very sad. it is like people at the end of the 70s, imagining that leisure suits could never go out of style... The more you think about it, the parallels to the late 70's are amazing. Just substitute oil & gas for technology. Back then, we all KNEW that crude was going to be $100/barrel before the end of the century. It was just SO obvious that there was going to be a permanent shortage of energy. The Cisco of those times was Schlumberger. Talented engineers of 1980 went to SLB and the then rather high starting salary of $40,000/year. After all, SLB was the company that built the equipment that was going to enable us to find enough oil to satisfy the world's needs. In fact, SLB dominated the oil service business. Heck, they still do. (Just replace crude oil with the Internet, and you've got Cisco.) In 1980, SLB traded a fraction under $40/share. It took more than 16 years for SLB to reach that price again. The annualized return from that 1980 peak to today, even with the recent good performance, is only 2.3%. Perhaps more troubling is that even if an investor was able to pick the ABSOLUTE BOTTOM in SLB in 1987, the annualized return would still be only 13.3%. Cisco could very well still be in business in 2035. Heck if I know. But that doesn't necessarily mean that this makes CSCO a good investment today.