This article, which I found on the Yahoo KLIC thread, mentions that amat could have a "crimp" in earnings due to oil prices causing a slowing of cap ex spending in Asian. I don't know much about winter oil consumption in this area. Does anyone know about oil dependence in Asia that could comment on the theory presented in the article?
"Exports of chip components by companies like Applied Materials of Santa Clara and Lam Research of Fremont would be crimped by an Asian slowdown, says Tia-min Pang, an analyst at S.G. Cowen & Co. who follows the chip equipment sector.
Asian economies are much less energy-efficient than the United States, he said, and they are expected to suffer badly if oil prices rise further. ``As the cost of manufacturing increases, they're going to have to cut back on investments,'' said Pang. That would mean fewer purchases of U.S.-made equipment for those factories.
Sung Won Sohn, chief economist at Wells Fargo Bank, said that every $10 increase in the price of a barrel of oil amounts to a 1 percent tax on consumer take-home pay.
The impact is subtle but significant. For example, said Sohn, businesses and consumers might decide to use their personal computers for another six months instead of upgrading them, slowing computer sales.
``If you have to spend more of your budget on energy -- whether you're a country, a company or a person -- you're going to have less money for high-tech kinds of products,'' said money manager Richard."
sjmercury.com
All opinions welcome
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