A Wild Ride

Texas Internet stocks are on a roller coaster these days. They’re not for the faint of heart—and they may not be for the stout of heart, either

Maybe we should call them “the ninety-niners”: the millions of people who, like the forty-niners of another era, are panning for riches, only this time by buying and selling Internet-related stocks. “There’s a mania going on,” says I. Craig Hester, the CEO of Hester Capital Management in Austin. “There’s a huge appetite in the investing public for companies associated with the Internet.”

That mania, a kind of gold-rush fever, has been one of the biggest business stories lately, raising the eyebrows of everyone from Doonesbury’s Garry Trudeau to Federal Reserve Board chairman Alan Greenspan, who has compared the spikes and dips of Internet stocks to a lottery. The Fed chief has also warned senior citizens to stay away from these stocks because of the risk, and he isn’t the only one counseling caution. “You need ice water in your veins,” says Art Bonnel, who manages the Bonnel Growth Fund for U.S. Global Investors in San Antonio.

It’s certainly true that some investors in a few of the hottest Internet stocks have doubled, tripled, or even quadrupled their money in an astonishingly short time—at least on paper—while others

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