Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Ed Schultz who wrote (13926)	1/7/1999 12:02:00 PM
From: miraje	Respond to of 74651

There real estate market and our internet stocks are one and the same. Ed, The percentage of GNP currently tied up in the market cap of internet stocks is miniscule in comparison to the Japanese real estate fiasco. Two different animals. The AMZN's of the world are grossly over priced but the internet is real, not a fad, still in its infancy, and growing like a weed. I agree that a mild pullback in the market and in MSFT will probably happen soon, but I doubt 20-30%. Lots of cash available and too many bears howling on the Street. They missed the current run and want to talk the market down so they can climb aboard for the next leg up. Regards, JB

To: Ed Schultz who wrote (13926)	1/7/1999 1:00:00 PM
From: DownSouth	Read Replies (2) \| Respond to of 74651

Can you say "tulips"? Once the internet stocks come back to earth, and they will, everyone gets hammered. Comparing internets to tulips is not valid. Internet e-commerce stocks are one market segment. It could be argued that when these stocks fall, the rush to quality will sustain the blue chips, including tech companies that have earnings, such as MSFT, CSCO, etc. As a parallel, compare to the Japanese market back in the 80s. They hit a frothy 80 PE for the market which was double their typical PE. When the real estate market went bust, so did the entire economy from which they still have not been able to recover. There real estate market and our internet stocks are one and the same. When our internet stocks go bust, what will be the net effect of our economy? That is NOT a parallel. Comparing the real estate of Japan to our internet stocks is ridiculous! When the real estate market crumbles, every aspect of an economy is directly affected. When the internet stock segment crumbles it affects a major portion of a small segment of our economy. I have heard, for example, some convincing claims that the internet stock craze is being driven by individual investors, not the institutions. The institutions will survive an internet e-commerce stock fall nicely.

To: Ed Schultz who wrote (13926)	1/7/1999 3:18:00 PM
From: Uncle Frank	Read Replies (2) \| Respond to of 74651

>>Once the internet stocks come back to earth, and they will, everyone gets hammered. You comments are valid; at some point there will be a correction to the current exuberance. The choices seem to be: 1. Take profits now, and wait for the correction <FEAR> 2. Stay fully invested and ride with the trend <GREED> 3. Reduce portfolio volatility by moving a higher percentage into cash/bonds <FENCE WALKING> The analysts have been recommending #1 for the last 3 years. If I had listened to them, my portfolio would be 1/3 of today's value. #2 is risky since there is definitely potential of correction at these levels, but I'm not sure it makes sense to walk away from this period of unparalleled momentum. From all the analysis I've seen, liquidity rather than earnings growth is driving this surge, and I don't think the cash inrush from 401Ks, foreign investors, etc. will dry up in the near term. #3 might make sense; take some profits off the table and wait for a good moment like last October to reinvest. Short term, I feel we'll continue to see growth. 4Q growth for the techs and I'nuts will be magnificent and will spark more buying frenzy. Intc's report due 1/12 will be the bellweather for the sector, and I expect great reports later on from msft, csco, and dell. Maybe it would be prudent to take some chips off the table at the end of the quarter, or, if you're in great stocks, sell covered calls to generate income. IMHO, comparing the Internet to tulip bulbs or inflated Japanese real estate is not valid. The Internet is a valuable productivity tool, and ecommerce is here now and exploding. 49er Faithful Frank