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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: bananawind who wrote (12538)	7/17/1998 3:16:00 PM
From: JMD	Read Replies (1) \| Respond to of 152472

Oh Florid One, it must violate multiple ethical debate principles to throw me in the same ring with the Buffetts, Warren and Jimmy [holy moley, are they related?] although I do take the point regarding a rational buyer wanting lower prices when planning on FUTURE purchases. But me ALREADY own the Q and I'd have to hawk my Hobie board to buy more, so I want the damn thing to rocket pronto. Let the other dudes that ain't bought their burgers pony up at higher prices. Just by way of reference, I own a few stocks that have actually appreciated in price [which I had rather assumed was the object of the game]. When I compare my emotional reaction to those issues with our Mighty Q [which to date in my case has returned approximately T Bill rates] I must report a certain giddiness. But hell, their threads aren't worth a damn--what's more important? With regard to Jimmy Buffett and wanderlust, now you're talking! Great CD. smooth sailing to you. Mike Doyle

To: bananawind who wrote (12538)	7/17/1998 9:30:00 PM
From: Jon Koplik	Read Replies (3) \| Respond to of 152472

Jim - as some one who is NOT impressed with the methodology espoused by Warren Buffett ... (I don't know how to italicize stuff) A short quiz: If you plan to eat hamburgers throughout your life and are not a cattle producer, should you wish for higher or lower prices for beef? Likewise, if you are going to buy a car from time to time but are not an auto manufacturer, should you prefer higher or lower car prices? These questions, of course, answer themselves. But now for the final exam: If you expect to be a net saver during the next five years, should you hope for a higher or lower stock market during that period? Many investors get this one wrong. Even though they are going to be net buyers of stocks for many years to come, they are elated when stock prices rise and depressed when they fall. In effect, they rejoice because prices have risen for the "hamburgers" they will soon be buying. This reaction makes no sense. Only those who will be sellers of equities in the near future should be happy at seeing stocks rise. Prospective purchasers should much prefer sinking prices. -W. Buffett, 1997 Letter to Shareholders I would like to offer my version of what was just stated. You are convinced that something (say sugar or silver or Digital Equipment stock or Wang Labs stock) is going to do great. You buy some, it goes down. W.B. says this is great news! You buy more. It goes sideways or down some more. You have some incremental, unexpected cash flow, and you are all excited because now you get to purchase more at an EVEN lower price. You buy more. Etc., etc. Then, you go bankrupt, because you were totally wrong on your whole concept. This is what I have seen many times during my many years of watching and participating in this stuff. I do not believe that an endlessly flat to down price for something is good news for buyers. They have to be EXACTLY correct that the whole rest of the world will later prove wrong. And, I would maintain that the difference between being able to accumulate for a period of time in a flat to down environment vs. a period of rising prices is NOT some profound factor that makes the whole deal work. It is simply that whatever you were betting on did indeed turn out to be correct. Knowing that QCOM was indeed significantly cheaper in price if you go back more than 3 years is very reassuring to me. I really find it hard to believe that we should all be happier if the share price were still unchanged to down for the whole period of public trading of QCOM. (By the way, W.B.'s claim to have "always made money in commodities trading" has a minor footnote. He admitted to still being long some crude oil futures; and they are a huge loser given the timing of his purchases). (But, it could still work out...) Jon.