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Technology Stocks : JDS Uniphase (JDSU)
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To: sam who wrote (16464)1/11/2001 2:26:57 PM
From: pat mudge  Read Replies (1) of 24042
 
Notice how carriers are now being bought up...and how they are now even able to secure loans unavailable to them just three weeks ago? Where was that in Sagawa's 'analyses'... He totally missed the effects of significant rate cuts in that report gobbled up by the likes of Jim Cramer. Also, notice how the NASDAQ's trading patterns have changed since the FED lowered rates? Downdrafts are sharper and less "grindy." Volume is increasing. I still believe we may go significantly lower at least once more...bad earnings news will continue to chip away at large rallies...and hedge funds are still shorting as if the apocalypse was just around the corner...but the bear is dead (at least for now).


It's hard not to be skeptical when looking at the genesis of the downward spiral. In part I think analysts assumed telecom upgrades would have much shorter cycles similar to the computer industry. Sagawa has been a LU backer for years and I suspect some if not all of his analysis was biased by what he saw there. Akin to the blind man guessing the nature of an elephant by holding its tail. Combined with a couple ISPs/CLECs having financial problems and data that showed capex slowing (a redherring b/c it was shifting to optics away from copper/voice), the stage was set. On top of the Fed raising rates, throw in seasonal slowdowns, the traditional "October effect," nervousness over elections (ad nauseum), and the small snowball that started in early summer just kept getting bigger. Of course at some point the damage could have been self-fulfilling --- the misguidance could have become the seed of its own destruction.

Once we get through the transition from a negative market to a positive one, analysts will come out with new reports and the slant will change. Instead of focusing on the few who aren't making it --- and there will be failures (among CLECs/ISPs and those who supply them)--- to the strength in the broader industry where the lion's share of capex goes.

Now, how long do you think it will take Cramer to change his tune? Shall we start a contest to see who comes closest? <ggg>

Pat
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