On Sat, 2 Dec 1995 anonymous-remailer@shell.portal.com wrote:

...

The market seems to "think" that it's a better present judge of what Netscape has than he does. It's almost as though the "market" has developed a "mind" of its own.

Well, of course! Markets are the most efficient integration of the minds of the participants, hands down.

Hands down efficient integration?? Not especially. First you have to really wonder what and who the "participants" in this market are. As an example, year-ends have certain particular momentums. So do capital gains considerations. All part of the mind of Buddha, as some of the fruitcake players might say ... and all part of the known interplaying "participants".

...

It's own particular neural network.

Exactly. Literally. And huge, too.

Except that this one doesn't listen to any of its sensors or input devices. It's learned to ignore all of *that* information, because all of *that* information is inherently untrustworthy, so it simply listens to it's very own dialogue. Sort of like feeding off of a feedback loop.

...

It's almost as though there is automated software at work.

Just like October, 1987. It simply listened to itself and kept telling itself that it was "actually" making money all the way down. Portfolio Insurance be damned, it was doing "OK".

There is: Wetware. Massive concurrent processing, heavy parallelism, inefficient I/O. Distributed, redundant memory. Inefficient but infinitely adaptable interprocessor routing. Capable of handling any degree of outage. All elements individually expendable. Self-replicating processors that have significant lead time but integrate smoothly into the net. Designs and builds its own outboard peripherals and interconnects. Best damned planetary computing system in this star system. But I diverge...

IMHO, there is very little wetware left in the market. This is now the 90's. Time to get with the programs.

It's not always right (though self-fulfilling prophecy is often a big part of the equation), and it often misses the anolamies, but because it IS an integration is precisely why it may mean something different than you suggest.

Oooo ... duelling programs ... especially one which is designed to ignore the other one and not listen to any of its "blather" ... this oughta be interesting to watch ... Luckily, I'm outside this theatre of operations.

Netscape's share price more directly reflects the personal involvement and upward view of real people with respect to the Internet/WWW than anything else we have.

"Personal" involvement and "real" people have very little to do with a market that is driven by institutions and other vectors. Institutions which have to "show" what their exposure to the "technology and Internet" sector is when they file their portfolio reports will want to show something on their book. And they'll look for a safety in numbers thing, and will flock to the "darlings". "Real people's views" also won't count for much if Netscape defines an entire new economic sector -- the ground floor of the Internet. "Real people" don't factor in if it becomes part of the S&P 500 and every index fund "has" to -- by definition -- buy it. "Real people" also have very little impact on the blow crazed trader who's on a run and actually actively managing and turning-over the pension funds or mutual funds of some group. (Or even a sector fund, whose by-laws won't allow it to sit on cash, as it flows in the door.) These guys have far more influence than the aggregate of individuals who might buy or sell "small" lots at the market. "Real people" don't impact nor control the communications networks of block trading reports. And they don't impact systems which *must* put their money out, and put it to work. Real people are really just noise in the flow. The idea that individual supply/demand is what moves prices is a fallacy. It's not the "reality" behind the shell game. Buying or selling pressure doesn't ever function as a price mover, because for every "buyer" there is a corresponding "seller". Zero-sums type of stuff. It no more reflects the inherent strength of the Internet, than the Dutch Tulip craze reflected the inherent strength of Tulips.

Remember, there are still naysayers out there, declaiming in places from books to columns to TV, while the reality is that computers are now outselling televisions, and a key new form of synergistic human communication is exploding in exponential growth. Humans deal on a personal level only moderately well with linear processes, and poorly with geometric processes -- it's understandable that the growth of the Internet/WWW and the implications of thereof would be late in being recognized and be incorrectly understood until sometime AFTER the changes have rocked the society.

Nonsense. (No offence, btw ...) We're back to the man who simply closes his eyes to what's happening, or the ostrich sticking its head in the sand. We've already got the experience to understand how these things work. They've got the "play book", and are following it step by step.

Capitalize ME to the tune of $5 billion, for instance, and I may be influential not only during the course of your life but the lives of your great-grandchildren.

Capitalize how? Balance sheet? Or market? A $1 Billion or $2 Billion rights issue might be one thing, but this one is another.

Selling Netscape short may or may not be a wise move -- selling market processes short is usually a fool's exercise in self-delusion.

It really depends on what and how you use that tool, doesn't it?? As an example, short sales are excellent ways of "creating" stock in thin markets. They can work to create a virtual share. This might sound strange, but it's a feature of the "market". "Shorts" usually sell borrowed stock hoping to buy it back cheaper at some later date. A broker goes out and "borrows" the stock from another broker, and then that stock is sold to a buyer. The two legs of the short sale actually work together to create a "virtual" share of the corporation. This creates "volume" by trading a "virtual share". At some point, these used to be called derivative plays, before that word became dirty in and of itself. To explain. Let's say that XCO owns 100 shares of Spyglass. And YCO "shorts" 100 Spyglass. What actually happens is that YCO has simply signed a note saying that they "owe" XCO's broker 100 shares of Spyglass. If YCO now sells that stock to ZCO, then there are actually now 200 shares of spyglass out there. 100 actual ones owned by XCO, and 100 virtual ones owned by ZCO. (And a note to someone that says ... I owe ya, a 100 Spyglass.) But the "virtual" stock is indistinguishable from the "actual" stock. Of course the generally known risk is that with price movements that YCO could loose a lot of money on its short. Especially in a "squeeze" play. But if YCO and ZCO are actually "friendly" then all they have to do is shift a lot of money around as the price gyrates. Back-to-back credit facilities usually suffice for this purpose, since all that they really need is a "note" from their banker saying that they're "good people" and are "good for the money", if something does go wrong. That their credit is good in the casino. (And mathematically in fact ... they are good for the money ... cause they don't have a market "position" or opinion, even though they can trade one heck of a lot.) In this case, the short can't be "squeezed" cause he's actually covered. But it can lead to some really interesting optics. And these programs do listen to optics. Especially if YCO and his ZCO friend are up against ACO and his BCO friend. I think it's all just a virtual war at that point. Something to watch via Quotron. But then you'd need a Quotron for that, wouldn't you?? Alice de 'nonymous ... ...just another one of those... P.S. This post is in the public domain. C. S. U. M. O. C. L. U. N. E.

We Jurgar Din (that will have to suffice: I do not yet live in a free country)

+"The battle, Sir, is not to the strong alone. It is to the+ +vigilant, the active, the brave. Besides, Sir, we have no + +election. If we were base enough to desire it, it is now + +too late to retire from the contest." -Patrick Henry 1775 +

-----BEGIN PGP SIGNATURE----- Version: 2.6.2

iQBVAwUBMMCsBEjw99YhtpnhAQE04QH8C+jk59lxyAqkVlfhd2VLw3TJKnECdXXJ fNE7S0QZyd5eqFnZ4wTyHeX18YfTg+xiFZPPfxpRCdgO/x2K8sxFWQ== =/2cN -----END PGP SIGNATURE-----