31fps by Sam Purtill A blog about business, technology, and life

Smart people can be so irrational sometimes…

I like reading Dave Winer's blog, but today he announced that he bought 300 shares of Apple (AAPL) stock (approx. $50k). I rarely ever click through to the sites from Google Reader, but this was the only one I clicked through today to see if I could comment on it. Let me quote what he says about the stock:

I decided, after giving it much thought, to buy 300 shares of Apple. I think it's a good long-term investment.

The only thing I had to look at was their P/E of 47.42. Ok you could go over hundreds of future earning potential scenarios for Apple, but it is SO ridiculous to justify a PE of 47.42 for a company that is already HUGE.

But then again, maybe everybody sees something that I don't? I'm just not buying into all this BS hype; MS is trading at a steady P/E of around 21, seems like a much better buy than Apple. Apple is a great company, they make awesome products, but the irrationality of the market seems so absurd to me.

Google's P/E of 52 doesn't look as bad to me, because I think Google is about to become the biggest telecom and ISP the world has ever seen, so they still a massive market to capture.

q ewjoifmdsalk aoidsjfsoi das

Ahh! All this stock market BS is making my brain hurt, people are just a bit crazy sometimes when it comes to the whole castle-in-the-air hype. Bleh.

Oh by the way... having a great time in SF, moved into my apartment and living on my own. More on that at a later time, I'm just mad at the market right now.