The Prudent Bear is a site worthy of note if you have significant exposure to the stock market.
- If you are 28, putting 10% of your pay each month into the market and planning to do so until you retire – don’t stop! Over long periods, the stock market should be a fine place for a large chunk of your money.
- But if you are retired, or a premature curmudgeon, check out its strong ‘value’ perspective.
For example, I draw your attention to Rob Peebles’ May 21 Market Summary, with this charming first line: ‘A person can learn a lot by not attending a conference.’ (Which was the model I aspired to, but did not always attain, in college.)
Bears tend to make fun of market pundits who pooh-pooh value – especially after those pundits’ picks have turned to pooh-pooh – and so this column dredges up Jim Cramer’s February 29, 2000, list of ‘Winners of the New World.’
Jim is a voluble pundit you can see nightly on CNBC and read regularly in New York Magazine. His predicted ‘Winners’ four years ago were: Mercury Interactive (MERQ) – $96.38 then, $45.39 today, down by more than half . . . Veritas Software (VRTS) – $197.88 then, $24.67 (and symbol VRTSE today), down 87.5% . . . InfoSpace.com (INSP) – down 85% from $217 then to $32.30 today . . . VeriSign (VRSN) – down 93% from $254 to $17.75 . . . Ariba (ARBA) – down 99.3% from $264.50 to $1.88 . . . and then these others for which I could not readily find prices: Digital Island (ISLD) . . . Exodus (EXDS) . . . Inktomi (INKT) . . . Sonera (SNRA) . . . and 724 Solutions (SVNX). Some of them merged, others disappeared. Could those of you who owned them fill me in? (Why should I do all the work?)
We certainly don’t have a bubble of the kind we had in 2000. But this can be a tough game, even if you attend conferences or watch the experts on CNBC.
Tomorrow: Fun with Economic Statistics
Quote of the Day
Guys, just remember: if you get real lucky, if you make a lot of money, if you go out and buy a lot of stuff, it's gonna break. You got your biggest, fanciest mansion in the world. It has air conditioning. It has a pool. Just think of all the pumps that are going to go out. Or go to a yacht basin any place in the world. Nobody is smiling and I'll tell you why: something broke that morning. The generator's out, the microwave oven doesn't work, the cook's gay. Things just don't mean happiness.~Ross Perot to Harvard B-School students, quoted in Forbes
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