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Columnist Comes Clean
By Brian D. Rossman
I must apologize, for it was I who caused the New York, American and NASDAQ markets to suffer historic losses. Do not blame NBC news correspondent Andrea Mitchell's husband, the chairman of the Federal Reserve, for this debacle. Place the blame squarely where it should lie, at my feet. I caused your stock to free-fall to its 52-week low. I am not proud of my actions.
Please Bear with me, for at a time like this, it is most difficult to speak. Oh, the humanity. I purchased your high-tech stock in order to cash in on an unworldly return. Yes, I admit I wanted--please forgive me--to get rich quick. I am so sorry. Had I known that it would jeopardize your irrational exuberance, I would have purchased a lottery ticket or joined a multilevel marketing scheme instead. I did not think anyone would know.
It was easy. I perpetrated this fraud from the comfort of my own home. I used an online broker who charged me $19.95 for the right to become a nouveau riche. Like the five gentlemen in 1997 who pooled their life savings to purchase shares of Qualcomm and watched their $150,000 investment turn into $30 million-plus, I believed my $10,000 investment would at least get me a down payment on a house in Silicon Valley. How else can one keep up with the (Dow) Joneses? Dotcom startups do not grow on trees. (Sand hills, maybe). I just had to try my luck.
The broad market had almost doubled last year (NASDAQ was up 86 percent) and was moving faster this year. I needed to jump in and jump in quick. The media reported that stocks that had tripled last year had already grown 60 percent in 2000. This was easy money. How could one not succeed? Pick an IPO candidate, preferably one that proclaimed that it was involved in "the Internet," "B2B exchanges," "networking," "optics" or "broadband." Heck, even the old standbys, the biotechnology and telecommunication industries, were white-hot in early 2000.
So I typed in my order and pressed enter. I felt like a million bucks (or would soon, I hoped). I grabbed the real estate section of my local paper and mapped out the areas to begin the search for my dream home--to be paid in full with my market earnings. How long was I to wait? Did "day-trading" mean waiting three hours or an entire day? I wanted to get started on my search. Eight hours for a 400 percent return? I guessed I could wait. I decided to place my one stock into my online portfolio in order to observe the growth of my fortune.
Suddenly, I realized something was wrong. Very, very wrong! The ticker symbol was highlighted in red. Not a good sign. Red means loss. The right-hand column displayed a minus sign in front of the corresponding numbers depicting the downward dollar movement of the stock. The numbers were growing. "Down 6, down 8, down 12."
For a moment, I thought everything was fine. I mean, ALL the stocks were behaving this way. From GM to Microsoft to the Gap. Everyone was in the red. I turned on the radio for confirmation. "It is a record day at Wall Street. The market is suffering its worst losses ever."
On Friday, April 14, the NASDAQ composite sank 355.49, or 9.67 percent. Numerically the drop was the largest ever, and second largest in percentage terms. In one month, the exchange dropped 34.2 percent from its high of 5,048.62. In the preceding week alone, the index dropped 1,125.16 points, or 25.3 percent. It was also down 18.4 percent for the year.
Please do not judge me too harshly. I had to climb aboard the stock market gravy train. I had needs just like you. I needed to retire before the age of 40. I needed to be free to make my own decisions. I needed a home in Atherton. But, alas, my fellow shareholders, someone must have discovered my plan. Now our fleeting fortunes have fled. Woe to us all.
Yet, with every downfall comes opportunity. It is time to roll up our sleeves and embark on our Puritan work ethic. Anyone know of a job opening at a pre-IPO startup?
Campbell native Brian D. Rossman is an attorney and a business consultant for high-tech companies. His column appears every other week in this space. Contact Brian at bdrlaw@bigfoot.com.
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Campbell, California
