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Strategies & Market Trends : Graham and Doddsville -- Value Investing In The New Era -- Ignore unavailable to you. Want to Upgrade?

To: porcupine --''''> who wrote (1260)	2/14/1999 8:09:00 PM
From: porcupine --''''>	Read Replies (1) \| Respond to of 1722

This week in Barron's, a letter writer, in criticizing the notion that well known consumer companies are sure-bet investments, asserts that Pepsi, Quaker Oats, and Wrigley's have each gone bankrupt 3 times! I wasn't aware of this. Do others believe it is true? If true, comments anyone?

To: porcupine --''''> who wrote (1260)	2/15/1999 10:42:00 AM
From: Freedom Fighter	Respond to of 1722

Porc, >>[Isn't 48 times earnings the level the Nikkei Eventually Reached? RR]<< I think that's about right. And no doubt if the Fed keeps pumping money and there are offsetting deflationary forces in the system like there was in Japan we will get to 48 times earnings. To me that is really frightening. It would verify how ridiculous our current fiat system is and how irresponsible those in charge of it are. The one thing about all these articles that never ceases to amaze me is that they all imply that if interest rates fall, inflation falls, and thus nominal GDP growth falls that you can still grow profits at the same pace over the long term and that the returns on future invested capital will still be the same. Some of that is mathematically impossible. So while I agree with their math and the model, the assumptions input in many cases are preposterous for an attempted levelheaded view. Wayne