Richard Bernstein on the Nifty Fifty bubble

In the late 1960s and early 1970s, major institutional portfolio managers became so enamored with the idea of growth in general, and with the so-called "Nifty-Fifty" growth stocks in particular, that they were willing to pay any price at all for the privilege of owning shares in companies like Xerox, Coca Cola, IBM, and Polaroid.  These investment managers defined the risk in the Nifty-Fifty, not as the risk of overpaying, but as the risk of not owning them: the growth prospects seemed so certain that the future level of earnings and dividends would, in God's time, always justify whatever they paid.  They considered the risk of paying too much miniscule compared with the risk of buying shares, even at a low price, in companies like Union Carbide or General Motors, whose fortunes were uncertain because of their exposure to business cycles and competition.

~ Richard Bernstein, Against the Gods

(See here for larger image of below's page.)