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

To: Michael Burry who wrote (6598)	4/7/1999 1:05:00 AM
From: jeffbas	Read Replies (3) \| Respond to of 78519

Internet stock speculation is a new paradigm that I have never seen in 35 years of investing. It is VERY dangerous for us value investors. Look at your AMZN shorts. You would have made a ton if you bought it instead of shorting it the first time. You would have made another ton if you had gone long when you covered at 104, instead of just covering. The guy on the street was making those buys. When money can be made this easily by people who know nothing, then money will be sucked out of everything else, and especially smaller company stocks. A correction of this phenomenon will require a slaughter of those folks and in my opinion must occur before sanity can return to what is value and what is not. That will NOT be fun for anyone when it happens. Therefore, I conclude that no value stock should be bought merely because it is cheap (no matter how cheap), unless there is a highly visible catalyst for it attracting buying from the shrunken pool of money available for investment in these stocks. I hate to be so gloomy but I have been looking for an explanation of what is going on and this is how I see it.