When I left Tiger in December, my parting recommendation was that 2001 would be the year of anti-tech. The cult that developed around tech stock investing between 1995 and 2000 was without precedent. Basic valuation concepts were abandoned, replaced by measures of reserves in the ground and barrels per share, much like page views came to measure the dot-coms. But when the dot-com profits failed to materialize, the followers fled. But the market hadn't seen what the wrath of jilted tech investors could do until the megastars disappointed.
Blind faith leads to blind fury when the basic tenets of a belief are dashed.
For the past seven months, the market has witnessed the destruction of an investment cult that allowed itself to believe that technology was a fountain of wealth, where, once you abandoned old beliefs about valuation, you could realize unlimited fortune. Find out what replaces the obsession with technology in Part 2. Tom Kurlak is the former semiconductor industry analyst for Merrill Lynch, now retired. For nineteen consecutive years, Kurlak was on the Institutional Investor All-Star Team until his departure for Tiger Management in February, 1999. At time of publication, Kurlak was long Ericsson and Intel, although holdings can change at any time.