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   Strategies & Market TrendsValue Investing


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To: Michael Burry who wrote (8375)9/24/1999 10:04:00 PM
From: sjemmeri
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I've got just one problem with the upcoming market crash/correction/bear market. Everyone is expecting it to happen this fall. I mean everyone on the SI boards - even internet IPO groups - is talking about it. Can the market possibly take a major hit if everyone is planning on it?

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To: sjemmeri who wrote (8377)9/24/1999 10:52:00 PM
From: Michael Burry
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Can the market possibly take a major hit if everyone is planning on it?

Why not? The last five years everyone planned for the market to go up.

Good investing,
Mike

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To: Michael Burry who wrote (8378)9/25/1999 12:39:00 AM
From: peter michaelson
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You guys notice how strangely - eerily - quiet these SI boards have become. People are simply losing interest
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perhaps.

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To: Investor2 who wrote (8362)9/25/1999 1:31:00 AM
From: Paul Senior
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Hi I2, regarding how value investors are fairing. I separate that from how value stocks are fairing. I assume value investors are fairing okay. A broad-based decline has not occurred (yet) to destroy the years of building up gains (and taking profits) in value stocks, imo.

The scariness of the market is tempered by the many great buying opportunities that are out there now. Specialty chemicals (coatings), for example, being one such area with which we share a common interest :>).

Paul Senior

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To: Robert Hoefer who wrote (8369)9/25/1999 1:44:00 AM
From: Paul Senior
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Hi Robert. I took a position in UDR last year after discussing briefly with Richard Barron on his REITS thread. I have seen both positive and negative media writeups on the stock since. I hold it still - along with about five other REITs. Paul Senior.

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To: peter michaelson who wrote (8379)9/25/1999 2:28:00 AM
From: Michael Burry
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Losing interest in the market? Or losing interest in new stocks to buy? Or losing interest in SI after the facelift? Dunno.

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To: Paul Senior who wrote (8381)9/25/1999 2:32:00 AM
From: Michael Burry
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Paul, which 5 others?

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To: Bob Rudd who wrote (8361)9/25/1999 7:56:00 AM
From: Bob Rudd
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Manu. Housing: Positive Barron's article may yeild a bounce, but I suspect tax loss selling produces lower lows ahead. One fundamental issue is degree of vertical integration - ownership of dealers: IMO a no-profit zone of the first magnitude with net disintermediation looming...lower cost, 'bricks & clicks' ways of reaching consumer.

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To: sjemmeri who wrote (8377)9/25/1999 8:21:00 AM
From: James Clarke
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Clearly "everyone" is not planning on a major hit this fall or the indices would be down a hell of a lot more than they are.

As for how value investors are doing in this drop - this one is getting creamed. Internet shorts have not been quite the market hedge I thought they would be. They were up last week!

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To: James Clarke who wrote (8385)9/25/1999 12:04:00 PM
From: Michael Burry
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Jim,

I thought of you this week as I looked at the stocks on my some-25 watch lists, and noted that of the hundreds of stocks, the net stocks are doing quite well. I had thought you covered. Ouch.

For the last week I've been carrying "The Art of Short Selling" around with me just about everywhere. Every time I get a break, I just open to a chapter. Doesn't matter if I've already read it. I just read it again.

If there's one thing that keeps hitting me in the head about that book and its cases is that there's a lot of time to short and still come out ahead. The problem with net stocks is that they appear as if they require constant capital infusions, which makes them good shorts. But they're getting these infusions at will. That makes now now a good time. When the capital spicket is turned off, the stocks will react downward, but won't fully account for how bad the news is then. They'll be terminally wounded but the price won't reflect it. That's when IMO you'll be able to grab a lot of the net stocks on their way to zero. But before that, a lot of smaller companies will pitch themselves to larger companies. So the wild card is that they get taken over by a bigger, stupider, more capital-rich, company, a la Yahoo of GeoCities, which stands out as the single most characteristic action of this era. The AofSS describes this risk as the thing that keeps ss's sweaty-palmed and awake at night. I think for good reason.

For my next, more certain short, I'm taking a long, measured look at Pre-Paid Legal (PPL). I posted why over on that thread. I think I finally understand that one.

Mike

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