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If you're into Apple (AAPL) or gold for the long term and you have been in for a long time you can stay put. If you are in them to make a quick buck, get out quickly!Apple and gold are at all time highs. Yes, they may go higher, but not much and not soon.
The reason is that both Apple and gold (and probably golden apples) already include all the product info and inflation fears that could be. The next level is pure speculation. Do you want to speculate or invest? If the latter, invest elsewhere.
A notable historic sign of an overextended market is when 'Joe Public' starts expressing its investment 'wisdom' more and more loudly. Think of all the con men doing infomercials about gold prices going sky high, doubling or tripling yet again. Doesn't that make you wonder why they would be sellers instead of buyers themselves and make 200% to 300% returns (if they believed their own nonsense) instead of the common 10% margins? They are simply taking advantage of a gullible public and when the fervor subsides they will move back to snake oil.
Everyone is talking about all of Apple's new products long before they are announced by Apple. Lots of people assume whatever it is, and whatever it does, will be a huge hit. If you're wrong, the only hit will be to your portfolio.
If you think the pot is not boiling over yet, then perhaps this comment from a reader yesterday in my Chasing Value series makes my point more clearly, "Apple can only go one way at this time, and that is up, up and up again."
Sheldon Liber is the CEO of a small private investment company and the principal for design and research at an architecture & planning firm. He writes the columns Chasing Value and Serious Money.
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Reader Comments (Page 1 of 1)
12-11-2009 @ 2:10PM
MyKisa said...
...yeah, sell your gold, get some paper or promises...yeah thats the ticket
12-11-2009 @ 2:15PM
Brandon said...
So, Apple has gone up in the past year, for no apparent reason, right?
And just because it's December 2009, this means that we've reached the top? And now we're on the way down? Just because?
What you say might be true, or it might not be. Do you have any actual analysis or facts? How exactly do you get paid for writing crap like this?
12-11-2009 @ 2:24PM
vdvd said...
"Apple can only go one way at this time, and that is up, up and up again."
I think this person was talking about Apple's profit margin (which would be essentially an absolute fact). Unfortunately the FACT that Apple WILL make profits, hand over fist, for the foreseeable future is no protection from the MM forces who have the power to move the stock's price anywhere they want to.
12-11-2009 @ 2:31PM
Sheldon L said...
Greg,
Always nice to hear from you. I agree that Apple might be worth 10% to 15% more. There is nothing magical about $200. As you recall (and I think I am owed a dinner) my historical track record on AAPL's value has been very accurate.
In yesterday's Chasing Value I simply did not think AAPL made the grade among my top picks for 2010.
I think it will drop in January as investors take some profits pushing taxes further out and maybe that will present a buying opportunity.
12-11-2009 @ 4:36PM
Bert Vanderveen said...
Cramer, you are soooo far off that I wonder whether you are on the sauce in a very bad way. Sober up!
2-02-2010 @ 9:56AM
addictsports said...
"Apple can only go one way at this time, and that is up, up and up again."
Who knew investing was this easy!
Sell Gold? Perhaps. At least you do not have to leave your computer with places like http://www.sellyourgold.com and Cash 4 Gold :)