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Technology Stocks : Amazon.com, Inc. (AMZN)

AMZN 227.90

+0.4%

3:59 PM EST

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To: GST who wrote (128309)	7/15/2001 3:26:18 AM
From: schrodingers_cat	Read Replies (2) of 164684

The reason that I think a rally is possible over the next few weeks is that the earnings reports will sound better than the earnings warnings of the past month. It's a question of the news being relatively better than it has recently been. I'm not talking about fundamentals, which the market mostly seems to ignore. It's remarkable how bad the fundamentals have become for some tech companies, and this goes far beyond the problems caused by a slow economy. The really big problem is that a number of product cycles have come to an end. The build-out of the internet has certainly stalled and may well have been completed. The buildout of the cell phone infrstructure looks to have peaked. People no longer lust after more processing power and so the fire has gone out of the PC industry. Where are the new killer-apps to drive the next wave of growth? Will there be a next wave of growth? Will broadband and video on demand live up to the expectations? >...little to look forward to... : Except the summer doldrums, and the historically weak months of Sept and Oct. Not to mention year end tax loss selling. > Denial of the economic situation....: Here I am more optimistic. I think that expectations for a Q2 turn around were silly, because interest rate cuts never work that fast. That was just wishful thinking. I figure that rate cuts take nine months to have their full effect. Since it took the Fed until Apr, IIRC, to reduce interest rates by 2%, then the effect of the cuts can't really be judged until Q4 reporting season, ie Jan 02. Even then there will still be a few cuts in the pipeline. With consumer and construction spending holding up, and energy prices falling, the economy seems to be on a glidepath for recovery IMO.

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