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To: Richard Habib who wrote (17872)	9/11/1998 8:40:00 PM
From: Phillip C. Lee	Respond to of 213177

Richard and Alomex, you both are correct about PE, supply and demand. It's like in probability theory, if you throw a coin, we assume each time the probability that it appears head or tail will be 0.5. Then, you may ask what probability it is if we throw 5 times with more than 3 times with head outcomes. The stock's PE is like the probability of head or tail with a constant value. If the probability that appears to be over 0.5, then we assume it's higher than average. Similarly, if PE is under 20 and under the average PE of S&P 500, then it appears that the stock will perform better than others without such conditions. Moreover, how do you prove the probability of showing head or tail is 0.5? The answer is to throw as many times as possible, then you would get a value close to 0.5. Although AAPL has excellent PE and revenue growth potential, high cash reserve, good leadership, competitive products etc., we need time to make it show its real value, the same theory on throwing a coin. Outside's factors as Richard mentioned will impact any stocks but those factors are not as importnat as US domestic conditions, such as unemployment/interest/ inflation rates, GDP, budget etc. However, those factors will more or less impact any stock's movement in a short term basis. The real fundamentals will be back like we prove throwing coin theory. Phil

To: Richard Habib who wrote (17872)	9/14/1998 9:07:00 AM
From: Mark Palmberg	Read Replies (1) \| Respond to of 213177

Alomex and Mark, you seem to believe the market should be based on some simple mathematical model whereby you crank in earnings and out comes stock price. WRONG! I won't speak for Alomex, but this is just plain wrong. This is all about human nature, which I think is particularly germane to AAPL stock. As we've all seen, ad nauseum, over the last year or so, Apple fans who also invest in the company have a better than average tendency to fall in love with the stock (I know, it's a generalization). I don't have any good explanation for this other than to say that it may be more a reaction against being forced to use a Windows machine at work and at school than to appreciating the Mac for its many advantages. Yes, greed and fear do move this market, at least as far as small investors go. I can't speak to what goes on in big brokerage houses, but I would hope that there's at least a little more reasoning and cool-headedness there (this is NOT based on any evidence from the market). If your neighbor gets caught cheating on his wife, are you going to sell stock because of it? What if he's the manager of a large fund in which you've invested heavily? Would you sell then? What if he had a sexual encounter with his mistress on his desk at the office? Well? Would you give up a 20% year-to-year gain because the guy holding a big chunk of your retirement earnings couldn't keep his fly shut? Doesn't make much sense, does it? This, too, shall pass. And as far as the president's woes affecting supply and demand, well, I'm sure Warren Buffett would be happy to tell you that the impeachment of Clinton is not going to stop people from shaving or drinking Coke or buying insurance. Let's get a grip, folks. Mark