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To: Judith Williams who wrote (48096)	10/19/2001 10:57:08 AM
From: gdichaz	Respond to of 54805

Judith: Re: <<But all prides suffer during a drought--the strong can hold on a little longer but eventually they too get parched.>> This seems to be a good analogy to the last 18 months or so in the stock market. Thanks. And reverse should be true. If some rain begins to fall and the drought becomes less severe, the strong should recover first. So the question which the GG addresses is relevant - which companies are "the strong". Suggest that we not spend so much time fighting the last war (to mix up metaphors) that we miss opportunities which may be there in the next few months or years. Times have changed. But company specific distinctions seem to be still very relevant. Viva la GG. <G> Best. Cha2

To: Judith Williams who wrote (48096)	10/19/2001 11:26:00 AM
From: Thomas Mercer-Hursh	Read Replies (1) \| Respond to of 54805

One of the problems I have with the valuation criteria discussed so far is that the solutions are somewhat hermetically sealed. If we accept that the economy and the stock market in particular act as as self-organizing dynamic systems, the market is itself made up of a network of subsystems. Readily agreed ... but that doesn't mean that we can't move beyond current tools to include some element of the broader market in our evaluation. I think that all projections would have to be market relative, but I can imagine incorporating a factor to incorporate prevailing conditions into the buy/sell criteria.

To: Judith Williams who wrote (48096)	10/19/2001 3:00:38 PM
From: Pirah Naman	Read Replies (1) \| Respond to of 54805

Judith: I think we also must take that assumption a step farther and consider a follow on assumption--that the market ecosystem as a whole is subject to cyclicality. Very reasonable assumption, being as it has been repeatedly demonstrated as real. :-) Right now our metrics for valuation are intrinsic--having to do with competitive advantage and where the company is in the TALC. I would argue that what we have seen over the last year and a half has little to do with either, and everything to do with systemic factors for which we have few metrics and even fewer insights into the interaction of the subsystem and the wider environment. Yes, all the valuations discussed have been company specific. But we can recognize the demonstrated correlation of individual stocks to that of the broad market. We do have the option of considering that "market force" and adding in market valuation as an indicator. - Pirah