Hey Fearless, I agree with you 100%. Even though
I've not made as much as you, I have made equivalent
to the amount I got paid at my job (before I quit).
(No, it was not at seven eleven. I was actually a
college financial aid advisor).
Anyway, I made
between $3,000 - $4,000 per month. I still occassionally
buy and sell. However, I am now doing mission work
and am communicating through my laptop. It's not as
easy to ship products, etc.
I found Ebay and
was doing business through them way before it went
public. At least, here's my take on the competition
You can go to Ebay and look up "dog pantyhose" and
you will eventually find it. There is no other
auction service even close to the volume it has attained.
Even more, unlike Amazon, B&N, and all the other
ecommerce sites, once a person gets hooked into Ebay, they
don't want to leave because of competition. Let me
1. Sellers want to get as much out of their product
as possible. Thus, they will always go to the site
with the most bidders. Example: Let's say you can sell
a certain barbie for $500 on Ebay. However, if you
were to place it up on any other auction (with no
reserve), you'd probably get about $100, since there aren't
as many people bidding against each other. So, what
does this seller do when he places on say, Amazon? He
or she sets a reserve for $500, since they know that
they can get that on Ebay.
2. Buyers want to be
able to find what they want at the lowest price. Let's
say a buyer wants the above Barbie. He or she goes to
Amazon and sees it listed with a $500 reserve. However,
they go to Ebay and see that they can bid on it at a
lower price and possibly get it below that $500.
(Remember, the seller has not set a reserve at Ebay, due to
the volume of bidders).
This creates a
continual circle. Sellers want to sell where they can get
the most for their product, and buyers want to be
able to find what they want at the lowest
Anyway, I believe that the "invisible hand" of commerce
will work it all out in the end. However, unless Ebay
management really "messes up," it, in my opinion, IS THE #1
ONLINE BUSINESS!! Where else can a person buy whatever
they're looking for, as well as make money doing it!!
Get a life. EBay may be a good company, but that
observation has little to do with the price of its stock. And
if you are depending on short-covering to prop up
the price of the stock, you've already lost. Shorts
covering at a profit removes hard cash from the system.
Hint: this is bad for a stock.
quite heavily, on average at 155 or so. I do hold
Internet stocks though (like NITE and ATHM). EBAY stands
among Internuts - because its valuations are
high. As I explained in a previous
post, in order to justify
its valuation at a
generous but "reasonable" PE 5 years from
EBAY will be considered a "mature" company, EBAY
have to grow its earnings 15 to 30 times. Do you
will do that? And that's ONLY to keep
its price at the current
level. Think about
15 to 30 times in 5 years means around 100% growth
year. Do you really think EBAY will be able
to do that?
Look at its auction counts this
quarter - they are basically
stalled - from May it
increased from 2.2M+ to 2.3M+ - that
is not even 100%
growth right now - not speaking of a year or
now. Does that make you think?
understand what falling in love with a stock is.
done it before. But you have to resist it.
their greed. That's what they should deserve.
Generation after generation, people won't learn from
history. They only learn from their own misfortune, after
running up huge losses. How pitty a human being can be.
If you compare Ebay with a $100 m&m, you probably
do not hold any internet stocks or are even short on
them. For a long time every money manager with a litle
sense is saying the same thing about internet stocks,
maybe they are right or no, but believe me, all of them
regret not havig catch the bus early on. Nowadays there
is much more technology funds buying internet
bluechips than before, if they do not have them, they
cuould underperform the market, so the buyers are
changing and there are more people interested in getting
this stocks. So, even if your comparisson with the m&m
is right, I think that nobody is buying an internet
company because they are value investors. Or any
technology stock at all.
but once again - do you like M&M's? Do you think
Would you pay $100 for one? No? How
EBAY is a good company. It makes money.
It just doesn't make
(or will ever make) NEARLY
enough to justify the stock price.