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Strategies & Market Trends : Heinz Blasnik- Views You Can Use -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (1114)	5/12/2003 2:53:31 PM
From: zonder	Respond to of 4912

I see where you are coming from, but the projection is not supposed to be accurate like from a crystal ball. It just has to accurately represent the expectations of the time, so that the proper valuation can be done. That's where the bubble analysts went astray - they broke all ties with the traditional methods ("Cash flows don't mean a thing now, we'll value companies on no of clicks or no of customers" and all that...) and their projections and hence valuations did not correctly represent expectations of their period. What I'm saying is that people can't see the future, they are always projecting the future from something in the past (sometimes from past booms/busts). Agreed. However, an analyst cannot be expected to be correct about five years in the future. He is supposed to be within a 10% error margin of the current year. And even that is not as easy as it sounds, believe me :-)