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Strategies & Market Trends : Roger's 1998 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: Roger A. Babb who wrote (17965)	4/4/1999 10:02:00 AM
From: RockyBalboa	Respond to of 18691

Agreed! But we must see that it is -a technological revolution and -a tulip bulb in valuations of equity. As a rule of thumb, I think that any venture with a valuation of more than 12x annual revenue seems way overvalued (for revenue based earnings). Venture funds, like CMGI may be something different - but are, in principle based on the valuation of their holdings, like LCOS or GCTY which is again, depending on and relative to the content based sector. AMZN is still a good example. Regardless of the structure of the bond deal (actually it was "priced" at a conversion premium), they have been able to get off a 4.75% medium term bond, in a time when normal (non-internet) companies have to struggle to get anything under 7% or worse. C.

To: Roger A. Babb who wrote (17965)	4/4/1999 10:15:00 AM
From: Hank	Respond to of 18691

Of course, increasing stock prices exacerbates the over valuations with respect to earnings. I think there's a lot more trouble brewing out there than most people realize. Nobody really understands what risks the big money is taking with people's retirement funds and they are the ones that control this market, not you or I. They've pushed this market to the very edge of a cliff IMHO. A bubble, is a bubble, is a bubble, and they always break sooner or later.