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Tim,

One thing I hope you picked up clearly from the book: I don't believe many stocks GET significantly over- or undervalued. I believe most stocks are fairly valued. I think therefore that when the media begins to say something is overvalued -- particularly in a lemminglike fashion -- it is probably just "valued," and the media is scaring off people from investing in it, making it a good selection.

I do write that some people are momentum investors, but I don't recall the passage you've cited in quite the way you recall it. Perhaps you can quote verbatim what you're referring to. Again, I don't believe that even momentum investors necessarily are driving stocks to being "overvalued." My criticism of them is that they only look at price performance, and know little to nothing else about the company.

I believe for the most part that the market is "efficient" and that the prices you see out there are as fair as the price tags you find at your local Wal-Mart. For this reason, I reject purchasing stocks based on their "valuation."

Fool on,

David
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