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When the Nikkei was in the high 30,000 area everyone, including Peter
Lynch, identified it as a bubble. Mutual funds were buying Nikkei put
warrants with both hands. Lynch went short .... Soros went short ........
Your observation is unfair in that there was an enormous amount of Nikkei
shorting by US investors.
Daniel Goncharoff wrote:
> 'When Nikkei hit 40.000 nobody labeled it a bubble except a few
> weirdos.'
>
> Well, in Japan, maybe. In the west, nobody understood how growth rates
> in the teens could support PE ratios around 100. In the end, it
> couldn't.
>
> 'The truth is also, the majority is now seriously looking for valuation
> models. By majority, I mean the mainstream institutionals who invest
> more and more in tech and net, because of perf pressure and benchmarks
> (Yahoo in SP)
>
> My best guess is we'll start a major selection process, with leaders
> commanding premiums and the others falling through the floor.'
>
> Exactly! We are already seeing that with Amazon, now that higher sales
> has failed to translate into smaller losses, and other E-tailers, who
> throw VC money at customers in the vain hope they will come back, even
> when somebody else has a better deal tomorrow (good luck).
>
> 'My view is that rate fears are completely overblown.'
>
> There we disagree. I think the booming US economy will start to show
> more normal signs - - higher interest rates, higher wages, inflation.
>
> Regards
> DanG
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