Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: flint who wrote (3302)	4/26/2001 6:58:25 PM
From: Stock Farmer	Read Replies (1) of 74559

Negative view out of Sagawa on the boxmakers. NT AGM in Calgary was today too. All claiming customers have shut off the taps. Natural question: so are these customers good deals? Upstream shock. This tidbit forwarded, source not verified but apparantly from Reuters. Roth at NT AGM speaking of his customers: "Seven hundred billion was injected into the industry in one year -- this is a burst of energy we will probably not see in a few years," he said. Telecommunications companies in North America raised $715 billion in debt and equity in 2000, up from $409 billion in 1999, and $272 billion in 1998, according to Nortel. In the first quarter of this year, only $80 billion has been raised. "The flow of money absolutely stopped and this is what has resulted in an abrupt change in the industry. The capital markets started to look at financial returns of carriers and saw them declining...they saw inefficiency and price competition," he added. I guess when your customers are growing spending 100% per year you might get revenue growth of 50%/year. But if they ever stop... This is the part that the fanatics on the topic threads don't get. They extrapolate growth which its customers can't sustain... and growth in customers is not possible. Oops! John

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