I long for the Internet boom of the late '90s, when I was making $10,000 a day just holding those great old stocks: Yahoo! (NASDAQ:YHOO), eBay (NASDAQ:EBAY), Amazon (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT), and Dell (NASDAQ:DELL). Oh, and Internet Capital Group (NASDAQ:ICGE). I bought into the whole B2B (that's "business-to-business" for those who've already forgotten) concept, the brilliance behind the idea of Internet incubators, and the frenzy of Jim Cramer and other pundits touting the stock on financial news shows. "Heck," I thought, "Why not? I'm making money at everything these days!"
So I bought 100 shares at $149.50, feeling lucky to have gotten the stock at a 25% discount from its all-time high of $200. I made this purchase just four trading days before the Nasdaq peaked in March 2000. I ignored all the negative news on the stock.
By year's end it was trading at $3.28. Today, the price sits at $6.17 a share. Oh, I forgot to factor in the recent 1-to-20 reverse split. That means I bought five shares at $3,000 a share. But, hey, maybe it'll still come back!
We all had our horror stories from the go-go days of the millennium's end. But the lessons of a stock market mania can sometimes be forgotten with enough time. The human mind tends to blot out pain.
Still, I have in my possession a constant reminder of my biggest investing mistake, the casual way I tossed around money I now could desperately use, and the stupidity of gambling on something I knew nothing about. One share of Internet Capital Group sits framed above the computer where I do my Internet trades. The rest (all four shares of it) sit in my brokerage account, waiting for the day they can be sold to offset the gains reaped from an intelligent investment. And I see that balance when I download my quotes at the end of each day.
At the end of Star Trek II, just before Spock goes to his doom in the reactor chamber, he transfers his memory via a mind meld to an unconscious McCoy and whispers to him: "Remember." To you, the investor, before you drop a penny into the next big thing like nanotechnology, I say: "Remember."
Fool contributor Lawrence Meyers did sell Yahoo! at $425 a long time ago, but of the stocks mentioned in today's article, he owns only Microsoft.
