Forum Archive Index - January 2000

["hugh webber" <hugh.webber@clear.net.nz>]

thanks Tony, as an economist I think the most fascinating thing about the
tech progress is that it seems to be allowing real growth through improving
productivity with minimal inflation and you have to give all credit to Alan
Greenspan at 73 in picking this instead of just doing the usual monetarist
knee jerk reaction of choking off strong growth. Hopefully this phenomenon
will further penetrate the NZ economy and Dr Brash after being read the
Riot Act by Cullen will let it rip a bit instead of automatically
strangling it at birth as he has previously. It helps of course if your
currency is the world reserve currency as ours isn't...
No previous wave of tech progress has lasted indefinitely (Schumpeter wave
model is probably a good analogy) but its hard to see the end of this one
at the moment.

The bit that worries me is that at the mo every tech share is assumed to be
an outright winner but if you just look back within this tech wave you find
a number that have sunk without trace ...Commodore; Apple was in a very bad
way for years, whatever happened to BBC, Acorn etc - other people can
probably supply other names of tech firms that fell over. Telecom took some
heavy punches in Australia.
Its obvious that they can't all succeed as some of them are directly in
competition with each other and some of them are backing technology that
its already obvious is going to be overtaken by other technology a bit
later e.g. the wireless stuff vs glass fibre cables.

So unless I can get in early like Sausage I prefer the almost guaranteed
benefits of value investing and if its a choice of 5 reliable value two
baggers against one risky ten bagger where the horse has already
bolted.....

Still if you haven't got much riding on it why not have an educated punt.
Its when people go overboard and mortgage their houses without telling
their wives as in 1987 and the shoeshine boy or the taxi driver or barber
starts telling you what shares he's got and what you should buy that a
small cottage on Stewart Island starts to look inviting.

cheers Hugh.

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