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Strategies & Market Trends : Steve's Channelling Thread

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To: The Freep who wrote (18559)	6/22/2001 7:53:48 AM
From: Zeev Hed	Read Replies (2) of 30051

Freep, yes, you are right, but that blimp occurred when the BTB was at .78, not .44 or so. I do however, think that old measures of bottoms in stocks and BTB in semi equip will slowly change to another format. I have few of these under study. Over the next 10 years I believe that we will see a new trend in the semi industry, the percentage of sales being spent on capex will peak and start going down. Thus older measures of th cycle will have to change to what is acceptable in mature industries. The reason, IMHO, is that Moore law has 7 or at best, 10 more years to go. As for the current bottom in BTB and it indicating a possible bottom in the chip segment in general, I would advance the hypothesis that the valuations of some of the semi equip companies are still at about twice what they were in 1998, and 1998 was not a particularly severe bear market in the sector. This bear market is more like 1985, when we had one the then larger semi equip (GAC?) actually go under. In the last cycle there was at least a danger that LRCX would flounder (they brought in new management and the cycle turned in time). Maybe we need such an event to turn the market here. Zeev

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