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Technology Stocks : Amazon.com, Inc. (AMZN) -- Ignore unavailable to you. Want to Upgrade?

To: Oeconomicus who wrote (14741)	8/26/1998 11:19:00 PM
From: Rob S.	Read Replies (3) \| Respond to of 164684

Russia is just the tip of the iceberg that is indicative of the collapse of a world-wide capitalization bubble. Huge sums of money have been directed toward "emerging markets" without the controls normally encountered in western democracies. The wisdom that prevailed was that large loans could be used to build third world countries into modern-day countries in a greatly shortened time-frame. The problem goes much further and deeper than just Russia or just Asia or just the South Americas. This is a world-wide problem of a bursting bubble with the collapse of commodity prices that threatens to cause the default on a trillion dollar+ world-wide debt. What looks like a great thing for the US is only great at the PRESENT SNAP-SHOT MOMENT: high current employment and wages rising modestly above the inflation rate while raw resources and imported finished goods prices are great bargains. So we are able to get loads of really cheap stuff from these besieged debtor countries and that helps hold down inflation right? The consumer goes on spending the US to greater and greater prosperity, right? The trouble with economic collapse overseas and dramatically collapsing prices is that US corporations are dependent on the overseas markets and sources of supply and once the rabbit has coursed itself way through the boa, the result may be a collapsing US economy as well. I'm afraid that it will get much worse before it gets better. The problem will become particularly clear, in hind-sight, as it is exemplified in Amazon.com. The depth of the problem is that lots of money has been channelled into less productive uses both overseas and in the US. This has created a huge, monumental inefficiency in the world-wide economy. The bottom line is that many good companies with solid earnings and growth and reasonable debt/equity have found it overly difficult and expensive to raise revenues while their less efficient or fiscally conservative competitors have had boatloads of "free money" with which to wage grabs for markets and create cut-throat competition in which no-one ends up benefiting. "Irrational exuberance" in asset allocation is real and it's effects won't go away over-night. So far, the American and European public has, for the most part, simply throtled back on investing in stocks. We have had several years in which we have ridden the worldwide monetary expansion bubble with only momentary lapses. Even the downturn in '87 crash in the US was quickly absorbed by the world-wide expansion as companies turned increasingly to overseas markets as a means of growth and stabilty through diversification. The US and Europe now appear very strong as we ride on the bubble of the dropping cost of goods sold into the plush pockets of consumers. That could change rapidly. ---------- Forget all this stuff anyway - Amazongonenutty.com is not faced with any of these problems because it has been transported with bull and bear speculators onto the planet Bizzarro World. Default and collapse of foreign markets is good for AMZN and a spiraling down of the US economy will only mean it will be easier to hire cheap labor. Huge current debts and losses used to finance a speculative huge return is not anything like the huge amounts of money that were thrown at Asian, Russian or other companies in hopes that they would somehow return huge profits in the future as they captured mass markets. There just is no correltation at all between the lack of conern about competitive influences of capturing these markets overnight and Asian attempts to capture markets overnight (in relative terms). Prices will not collapse and render these investments in Amazongonenutty.com worth 10c on the dollar. On Bizzarro World it is not happening for naisA semiconductor, electronic, automobile and other companies so it won't happen for NZMA either. Just bend over backwards, smell the feet of the person behind you and if they smell like roses, then invest more or short more AMZN - either way, the stock is not bound by earthly concerns.