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Harry Newton's In Search of The Perfect Investment Newton's In Search Of The Perfect Investment. Technology Investor.

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8:30 AM Friday, November 11, 2005: Stockmarkets rose strongly yesterday. No one knows why. The trend of late has been upward. Maybe this is the beginning of of a fourth quarter boomlet?

The BIG urgency now is to reassess every one of your holdings. Disasters are happening super-fast. And resulting price drops wipe out years of hard-won gains. Big companies seem prone. Big technology companies are especially prone. I instance them because yesterday's favorites often have only one virtue: Wall Street is familiar with them. That means they get researched and recommended, e.g. Dell:

Or Intel:

Or stocks which flounder around forever, but never go anywhere, like Microsoft:

The BIG news is the explosion of the Cockroach Stocks: Companies become cockroach when they release unusual, bad news. Typically the news smells of scandal, stupidity or greed. Examples of cockroach stocks: AIG, Fannie Mae, Research in Motion (patent problems) and Guidant (faulty heart devices).

The expression cockroach stock comes from the habits of New York apartment cockroaches. You see one. You kill it (i.e. solve that problem). Three days later another one appears... and another. Endless bad news.

Then there are the BIG companies whose management has simply failed to keep up. We call them Dinosaur Stocks. It's amazing how fast dinosaurs like General Motors and Wal-Mart are falling out of bed.

Or even The New York Times, which has yet to figure that paper is dead:

Fact is major new forces -- like the Internet or rising energy costs -- have broadsided these companies. Their tired, antique management cannot keep up. There is a tendency to buy one of these erstwhile giants because they're now "cheap." This is akin to catching a falling knife. It's a game fraught with danger.

When in doubt, stay out.

TriPath Imaging brought its roadshow to town yesterday: They rented a fancy hotel room. They schlepped in all their fancy new equipment. They got all their management talking. The major result: It gave boredom a whole new meaning. I left early to play tennis.

Bottom line: Saleswise, they're doing great. Financially they're doing great. Technically they're doing brilliantly. Their equipment is super-special. The stuff they make saves lives. Their new equipment will save even more lives. Yesterday there weren't any case histories. "The SEC and the FDA won't allow us," they told me. There weren't any women who were now alive because TriPath had caught their cancer early on. There weren't any actresses pumping for early cervical cancer testing. There were just endless, humorless gray-suited Ph.Ds droning on in polysyllables and acronyms that would put their most ardent fan (i.e. me) to sleep. It worked. I fell asleep. It was delicious.

Suffice, the stock is $6.90. I've paid as much as $9.23 for the swath of TriPath Imaging I own. They're on track to earn really big bucks -- like become ten times their present size and the stock selling for $60. My latest "strategy" with TriPath is to forget about it for five years. By then, they'll have found some analysts from big Wall Street houses to cover it, some institutions will "discover" it and pump the price up or some big pharma company -- like Johnson and Johnson - will buy them.

I was right about Whole Foods. It dropped yesterday,then bounced back. Genius. See yesterday's column. Click here.

Wonderful advertising: The headline on an ad for American Laser Centers (which does hair removal):
"Life's too short to spend it shaving."

The woman and the parrot:
A woman went to a pet shop and immediately spotted a large, beautiful parrot..

The sign on the cage said $50.

"Why so little," she asked the pet store owner.

The owner looked at her and said, "Look, I should tell you first that this bird used to live in a house of prostitution and sometimes says some pretty vulgar stuff."

The woman thought about this, but decided she had to have the bird any way. She took it home and hung the bird's cage up in her living room, and waited for it to say something.

The bird looked around the room, then at her, and finally said, "New house, new madam."

The woman was a bit shocked at the implication, but then thought "that's really not so bad."

When her two teenage daughters got home from school the bird saw and said, "New house, new madam, new girls."

The girls and the woman were a bit offended, but then began to laugh about the situation considering how and where the parrot had been raised.

A short while later the woman's husband came home. The bird looked at him and said, "Hi, Keith...."

Watching TV:
A man and his wife were sitting in their living room when the man said:
"Just so you know dear, I never want to live in a vegetative state dependent on some machine. If that ever happens, just pull the plug."

His wife got up and unplugged the TV.

This will probably happen to all us soon:
thel was a demon in her wheelchair and charged around the nursing home, taking corners on one wheel and getting up to maximum
speed on the long corridors, shouting "Vroom, Vroom!" and making believe she was once again driving her car on the freeway. Because the poor woman was one sandwich short of a picnic, the other residents tolerated her. Some joined in to help her live her fantasy.

One day, Ethel was speeding up one corridor when a door opened and Kooky Clarence stepped out with his arm outstretched. "STOP! Police!" he shouted in a firm voice. "Have you got a license for that thing?"

Ethel fished around in her handbag and pulled out a Kit Kat wrapper and held it up to him.

"OK" he said, and away Ethel sped down the hall. As she took the corner near the TV lounge on one wheel, Weird Harold popped out in front of her and shouted, "STOP! Police! Have you got proof of insurance?"

Ethel dug into her handbag, pulled out a drink coaster, and held it up to him. Harold nodded, and said, "Carry on, ma'am."

As Ethel neared the final corridor before the front door, Crazy Craig stepped out in front of her, stark naked with a very sizable erection.

"Oh, good grief," cried Ethel, "Not the Breathalyzer again!"

Recent column highlights:
+ Dumb reasons we hold losing stocks. Click here.
+ How my private equity fund is doing. Click here.
+ Blackstone private equity funds. Click here.
+ Manhattan Pharmaceuticals: Click here.
+ NovaDel Biosciences appeals. Click here.
+ Hana Biosciences appeals. Click here.
+ All turned on by biotech. Click here.
+ Steve Jobs Commencement Address. The text is available: Click here. The full audio is available. Click here.
+ The March of the Penguins, an exquisite movie. Click here.
+ When to sell stocks. Click here.

Harry Newton

This column is about my personal search for the perfect investment. I don't give investment advice. For that you have to be registered with regulatory authorities, which I am not. I am a reporter and an investor. I make my daily column -- Monday through Friday -- freely available for three reasons: Writing is good for sorting things out in my brain. Second, the column is research for a book I'm writing called "In Search of the Perfect Investment." Third, I encourage my readers to send me their ideas, concerns and experiences. That way we can all learn together. My email address is . You can't click on my email address. You have to re-type it . This protects me from software scanning the Internet for email addresses to spam. I have no role in choosing the Google ads. Thus I cannot endorse any, though some look mighty interesting. If you click on a link, Google may send me money. That money will help pay Claire's law school tuition. Read more about Google AdSense, click here and here.
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