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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: James Clarke who wrote (17248)	6/15/2003 12:43:52 PM
From: Bob Rudd	Read Replies (1) \| Respond to of 78750

Regarding winners that had big red flags: We all buy companies with warts....that's what gives the price we seek. Usually we try to find a temporary problem that short-termers [most performance-driven institutional investors] can't afford to ignore...but more patient types like most of us can wait out. It's often not fun when the focus is on those problems...the price can drop well below expected levels and entry points. And there can be unexpected consequences in reactions from credit raters and regulators. But the prior 3 months have been different...very different, in that almost no 'wart' has been so big, hairy and ugly that it couldn't be ignored. The S&P is up 25% and some really doggy stuff...that looked like bankruptcy material finance.yahoo.com are up way more than that. The point being that this may not be the time to feel warm and fuzzy about dogs that have been cured of their 'fleas' as this is a time when the market ignores shortcomings...even those that remain serious issues. This benign view will not last.