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dear John

unfortunately i am not kidding.

Can you value a company that makes losses? Of course you can, the Australian Financial Review (a good read) has made losses for 20 years when it was founded. Yet i am sure you agree it was a product that was surely needed by the Financial Community, otherwise Rupert's News Corporation would have came up with that idea.

I think capitalism is fantastic, it allows the destruction of old companies and the formation of new companies. What may have been valuable 30 years ago is not valuable today. Remember the All Ords 25 years ago, companies such as MIM, Hamersley and Posideon were in the top ten stocks reflecting a resource focus.

Today the focus is on banking and media stocks. Who knows where ten years from now what the focus is. I am not saying the market is always correct but there are millions of individual investors who believe that by investng in a sector that grows above the market average they will be well positioned to capture the capital gains.

Now if you were a Graham & Dodd Investor, you would never invest in a technology stock. Yet without investing in technology, you would have missed all the gains of the last decade.

Will the stockmarket crash this year- i can tell you with 95% invested in a tech focus portfolio that the market will not crash. Sure they may be a slowdow but this is no 1987.

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