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

To: James Clarke who wrote (4877)	8/30/1998 9:18:00 AM
From: Joseph G.	Read Replies (1) \| Respond to of 78507

<< I will not argue with anybody on this thread who says that a hell of a lot of investments look very cheap right now.>> The correct question to ask is: are they going to look cheap a year or two from now. Suppose P/E is negative, div is cut twice, book is written off ... BTW, I like your post.

To: James Clarke who wrote (4877)	8/30/1998 12:49:00 PM
From: Michael Burry	Respond to of 78507

Annoying? No, you're earning my respect more and more. That's pretty tremendous discipline. Of course, if you've been out of the market, it is probably easier to wait. If you've been in it and getting killed like I am then there's a greater sense of urgency just by human nature. Irony of ironies, I got my chunk of money to invest for myself in very early May - so I was at 100% cash at the market top. Within three weeks I was fully invested in "relative values," many of which have fallen 40-60% in three months with no paper profits to cushion the blow. So having participated fully in the bear so far, there's no way I'm taking mine off the table now. Even more ironical, looking through my broker statement, I was actually selling partial positions of YPF at 31, Deswell at 16, Midway at 16 1/2, JOE at 29 1/2. So I made some right moves in mid-June, but the money went right into other stocks that have lost money. Yep, I'm staying on this train now no matter where it takes me. After making such critical wrong decisions in just the last three months, I don't even want to think what my stomach and wife would do if I stepped aside now and the market spurted another 40% upward. This tells me that the advantage goes to you and others more patient, wherever that patience comes from. Re: Amazon, are you sure about those single digits? I'd assume you mean that the business model just can't be profitable. It is growing revenues like crazy and it seems to me it has proven that its marquee is the dominant book-selling name on the internet. People thought Barnes and Noble would step in and take business but that's not happening, and I think that's why the stock has run up so much. Whether it can ever be profitable, though, I don't know. Re: newspaper articles terrifying people, the San Jose Mercury news did its best - Meltdown! in huge font on Friday morning. Mike

To: James Clarke who wrote (4877)	8/30/1998 7:52:00 PM
From: Shane M	Read Replies (1) \| Respond to of 78507

Jim, Comment on buying strategy. I also tend to be early and am learning the obvious lesson from that. WAIT. The problem with waiting, I've found, is that it causes me to want to pick the ultimate bottom and jump in more or less with a full position. An alternate strategy that I'm using now is to buy small positions, even odd lots, over several months time to build into a full position. Doing this I don't worry about missing the upswing nearly as much, and still have the benefit of dollar cost averaging. Although I'm trying to force myself to stop averaging down, I think I'm going to have to live with this tendency and hope it doesn't hurt me too bad. The other side of the coin is that it encourages me to average up, something I'm more hesitant to do, but should help keep money flowing into my winners. For me this works better and keeps me from building an "out-sized" position just because a stock keeps getting cheaper. On market psychology/an alternate viewpoint: FWIW, I don't sense fear, but rather resignation to the volatility. Around the office people are losing big, but I don't hear anybody thinking of pulling their money out of the market. The general concensus is "you've gotta take the good with the bad." Perhaps because we watch things so closely, our tendency is to overestimate the importance of the markets to most people. For many the money they're saving is for 20+ years down the road and the ups and downs right now don't mean so much. I think the staying power of Joe Investor is likely to be stronger than expected. Shane

To: James Clarke who wrote (4877)	8/30/1998 8:30:00 PM
From: Paul Senior	Read Replies (2) \| Respond to of 78507

Jim: Annoying? Not at all IMO. Your posts are important and add value for all of us. I will say that I find it unsettling that someone who is a paid professional value analyst, whose job it is (I presume) to analyze and recommend stocks and who apparently does this eight hours per day-- that person, for his own monies, is looking for market blips to raise cash and finds almost no values now worth buying for his own account. That you are not buying is scary to me since you have access to info and people on Wall Street. That you are not buying given the work you do, I find this to be a disconnect; I suspect I would find it to be even more disconcerting if I were a client of your firm. This all reinforces my feeling that value investors are better going it alone rather than giving funds to mutual funds who claim they are value investors but don't show they are eating their own cooking. Just my opinion, I mean no personal attack, just that there is a lot for me to learn still on how the world really works -g-. Paul.