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Gates warns of 'gold rush' for Internet stocks

Gates warns of 'gold rush' for Internet stocks By George Trefgarne in Davos

JEFF BEZOS, founder of Internet bookstore, yesterday joined Bill Gates, the founder of Microsoft, in Davos in warning off small investors from joining the wave of speculation in high-tech stocks.

Mr Bezos has seen the value of rise to over $20 billion, despite the fact it only has sales of $250m and has never made a profit.

He said: "It does not take much analysis to see that pure-play Internet stocks, including, are extremely vulnerable. In my opinion these are not appropriate investments for small investors."

Mr Gates, who over the weekend sent shockwaves through the World Economic Forum in Switzerland by warning Internet shares had created some "breathtaking" valuations, yesterday played down fears about the impact of the millennium bug, saying: "I think it is going to be less than half as bad as some people really fear."