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Pastimes : Clown-Free Zone... sorry, no clowns allowed
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To: Logain Ablar who wrote (87737)3/29/2001 8:23:01 PM
From: Andrew G.  Read Replies (2) of 436258
 
Tim: That has to rank as one of the all-time great TSCM interviews.
thestreet.com

I love the part where he said:

"You don't find semiconductor equipment companies giving vendor financing for customers to buy their equipment because they know there's always a downside to a cycle. This is something the telecom equipment manufacturers forgot."

Ravi Suria does the number crunching in a no-nonsense way and puts things into historical perspective. What a scarry, harry mess the Telcos and "New Economy" networks got themselves into. And all along he emphasized how difficult it is to deal with the overextended debt levels and why there is no money to buy out the new networks.

Now by comparison to leveraged corporate debt, what can one say about over leveraged consumer debt ? Consumer don't have the luxury of equity financing and refinancing one's home is not raising capital.

If there are other areas suffering as well, like manufacturing, and we can't find a significant catalyst for recovery soon, it looks like we are heading for more than a 'slow down' or recession but rather a complete economic bust (maybe a mini-depression) until debt levels are sufficiently absorbed to sustain positive earnings.

On the other hand, it seems our banking system is capable of extending payment terms out to near infinity and I can't fathom what logic goes with it.
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