Maurice: <<<They tend start pulling back on spending, and those not so necessary items.. Like Wireless Services.. > Wrong, wrong, wrong. Wireless services are necessary items. As was shown in the great Korean collapse of 1998, when the gloomy doomsters seemed to think the whole country had disappeared from the map of the world, the sale of CDMA wireless services didn't slow down at all.>>
First of all, The SEA Financial Crisis was a 'plip on the screen'.. An aberration.. It started in March of 1998, and was all but a distant memory by December of 1998.. Thanks to Alan G. and the IMF. But, what really pulled SEA out of it's financial crisis in such short order? It was the US and European consumers.. We awoke in September 0f 1998 to find our own financial markets in turmoil.. WHAT??? "People were eating worms in SEAsia". How could this be.. Everything looks OK here in the states.. Unemployment was low, Interest rates were low, Heck even Oil was going to $5 dollars a barrel!! We were experiencing deflation.. Bad news on the SEA front meant lower prices on import items.. We were living "bigger than life".. They only question about interest rates was would Greenspan lower interest rates by only 25 basis points, or would it be 50? However, there is no one to save a US slowdown.. Europe isn't going to save us.. They are in the middle of a currency crisis themselves.. SEAsia and company are not doing much better!
Lower import prices only meant "It's a SALE".. Everyone took to the mall.. Buy, Buy, Buy.. Just put it on "THE CARD".. No worry about losing one's employment.. There are 6 jobs waiting for me!! The production output was going "gangbusters" in SEAsia.. Sure no one at home was buying.. But the folks in the EU and US were buying like there was no tomorrow.. So SEAsia continued to export, export, export.. The US/EU consumer was largely responsible for the turnaround.. During this time.. Our US trade deficit bloomed.. The Container Ships were arriving at out ports overflowing.. But, were leaving empty!! But, that was OK!! Because the US consumer was SPENDING!! Like there was no tomorrow!. Sales of Wireless Services, notably in S. Korea, were still increasing at unbelievable rates during this time period.. Operators were announcing 80% increases in subs Q over Q. Of course, even you will admit that KOREA was not typical wireless model for SEAsia.. S. KOREA was/is that Meca of Wireless Competition.. 5 Licensed Operators in a country of 22 million POP's.. All using CDMA no less..All buying phones on subsidies at the time.. Why subsidize wireless phones by the Govt?? It's less expensive to subsidize phones than build out fixed wire-line infrastructure, and alot faster.. One of the reasons that many Koreans did not "disconnect" their wireless phones during the SEA Crisis, was that their wireless phone was their only alternative.. In other words. They had no wire-line phone at home!! In 1999 it was reported that S. Korea only had slightly more than 1.5 million Wire-line telephone.. Whereas it had near 5 million Wireless Users Phone users. So unlike the US where almost all wireless users have wire-line services available at home. Most S. Koreans had no choice but to keep their cell phones activated for basic communications. That is why, in my opinion, that cell phones are seen as more of a luxury items here in the states. vs. a basic necessity in S. Korea! The SEA Crisis was over before anyone had a chance to call their Wireless Provider to disconnect service!
Everyone remembered the SEAsia Crisis as just another "buying opportunity".
Now oil is high. Interest Rates are higher! Inflation is on the prowl. Corporate Earnings are coming under fire. Growth is slowing.. This is not the SEAsia Crisis/Plip.. There is no USA to pick up the spending cycle where we leave off!! Buy lot's of LEAPS when we hit bottom!!
i don't mean to be a "gloomy doomster", just a realist..
<<Wrong, wrong, wrong.>> I usually like people telling me I am wrong.. Because it usually leads to me making money!
How are those Satellite Radio Stocks Doing?? SIRI XMSR down about 40% in 30 days!! Single Digits here they come!!
Maybe I was wrong on SBUX.. But, I don't think so!!
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