Armin,
Others can answer better than me, but my opinion:
Deswell is more diversified, not really a semiconductor company. South Korea, Japan, Malaysia, & Thailand companies have major problems due to the currency devaluation, particularly those with debt. Interest rates are going very high as the countries try to support the currency. Their assets have suddenly become virtually worthless. Their cost to buy raw material (and they all import) is very high. Their employees are being hit by inflation and won't be able to live on the devalued wage as they import food and other necessities. They have a lot of problems to resolve before they can begin to compete.
Companies in Hong Kong, Singapore, & Taiwan are not being hit by these problems - except for property values. Those that are highly liquid with strong cash positions like Deswell and Namtai have major short term opportunities for profits and expansion. The other countries have major problems and cannot support their ailing businesses while the PRC has indicated a willingness to devalue the yuan if necessary to protect their economy.
Companies with a real problem are those US companies that have taken on debt to make recent expansions, particularly those expanding into the ailing Asian countries. We are looking at the possibility of a large increase in the balance of trade deficit and deflation. Good for the consumer, but not for company profits.
Just my thoughts,
Ron |
