From: John Conover <firstname.lastname@example.org>
Subject: Re: Microsoft is propping the market, and may crash with MSFT Re: Has S&P made a mistake or is Microsoft worth 400 billion?
Date: 6 May 1999 13:12:09 -0000
Archimedes Plutonium writes: > > John, can you elaborate on that. It is interesting for perhaps bull > markets occur with any sustaining strength and endurance when there > exists some form of monopoly in the midst of the bull market. That the > bull market requires some company that continues to have phenomenal > profits, such as Microsoft with its 30-40 cents on each sales dollar. > And of course, Microsoft inflates the smaller software companies such > as the Internet companies. > > John, I am wondering if a large monopoly is almost an essential > requirement for a rip roaring bull market. That a up market never > really becomes a bull market unless a large monopolistic company is > present in the marketplace, and that its performance permits the > continuing optimism. > There were companies that were a large "monopoly" in the bear markets, too. So the lemma would be that a large "monopoly" would be an essential requirement for a bear market. The same is true when the market was flat in the 60's-70's. It seems as though a large "monopoly" was always essential no matter what the market did. The bull/bear scenario seems to follow the EMH fairly accurately, with a fractal dimension of 2. See: http://www.johncon.com/john/correspondence/981230002304.31518.html http://www.johncon.com/john/correspondence/990212211510.16959.html John -- John Conover, email@example.com, http://www.johncon.com/