It turns out that I do have I-net access, and had I brought my network card, I could even have broadband; but no time, on the cusp of another divestment.
The father of a good friend wrote this. The dad is a retired fund manager. The son manages a private fund based in HK, concentrating on China, Taiwan and HK shares. The dad sends his thoughts out to friends on a regularly basis.
He sounds a lot like our friend Maurice. He is not wrong. But he does not address revenue, profit, competition, and valuation. None-the-less, his basic message is not wrong.
Chugs, Jay
QUOTE
Wall Street Dysentery
My thirty years of employment in New York, investigating, investing and advising clients might have been characterized as a misspent youth by anyone watching, but fortunately no one was. I was characterized by Bob Stovall of Reynolds & Co. as the 'golden garbage man' because of the curious nature of my research, and I accepted the characterization in good humor as it was intended, but his humorous barb did make me realize how little of what passed for research in Wall Street, including my own, was of long term validity.
Forecasting by the brokerage community was usually a news brief disguised as research, of little value.
In today's market place nothing passes for research from Wall Street that does not have a negative tone or bias. I find those messages misleading and unnecessarily pessimistic. Analysts are preoccupied with disappointing earnings results. A case in point is the dark outlook projected by Wall Street brokerage houses for the computer industry based on current quarterly results. If these analysts would only reflect for a moment, they might remember the unique sustaining properties of the computer industry.
Unlike automobiles, computers are not plagued with a resale or used market before they are scrapped. Historically, through research, the industry obsoletes its product line every eighteen months, (Moore's law). New computers continue to be cheaper, faster and more versatile year after year.
Not only is each new model better and cheaper than previous models, but the industry annually opens new markets for its products through new software applications. This incredible industry property permits the industry to renew itself, finding new uses for new users with amazing consistency. Miniaturization in computer chip development at lower and lower costs probably has reached its limit, and growth from this area of improvement may now be limited, although the world is by no means a saturated market.
However, more important stimuli for growth are present.
Broad band access and wireless applications will soon add still further
growth and versatility. In the very near future your next generation automobile PC will serve as radio, TV set, telephone and pager appliance all in one. Your car will have computers as standard equipment replacing radios.
Commuters will avoid hazardous highway conditions, telephone calls will be forwarded and personalized business news for the driver will be available as he drives to the office.
In medicine, through broadband access, and higher speed, computers human genome research has been revolutionized. A personal DNA card will soon be available to every citizen forewarning his or her physician of health problems before they occur. Bristol Myers has produced such a card already.
Because of recent computer innovations the Pap smear will be replaced shortly by a faster, safer, less expensive test; fingerprint identification is about to be replaced with a computer eye scan that airlines, police officers and passport officials will use. One executive in medical research noted that the number of blockbuster new drugs with great promise now being studied by his company numbers six hundred. The products that are in the pipeline boggle the mind. Five years ago there were only sixteen being studied.. (A blockbuster drug is one with an estimated worldwide market of a billion dollar.)
The stalled growth of local area networks will be re-ignited, as wireless telecommunications progress. Your present PC will no longer need a wire. 3G mobile phones are already available as miniature wireless computers. In five years estimated LAN expenditures will rise fifteen times, from $200,000,000 to $3,200,000,000. I listen to CNBC on TV every morning for an hour. Interviews with CEOs of publicly traded companies are frequent, and all of them report progress in reducing their costs at a faster and more efficient manner than earlier efforts. Their inventory control systems are quicker to respond to reduced demand with innovative software practices. We are learning how to deal with a sudden fall-off in demand.
Programs to improve quality or increase efficiency through advanced computer versatility and computation speed are in store for every business enterprise as well as hospitals and government offices. Because of broadband developments, the entertainment industry will be able transmit inexpensively to all computer screens. And the impact of these developments assures us that all national economies will benefit.
If I were running a research effort for a Wall Street firm today, I would focus on the promise of the immediate future, not the errors of the past, and I would restore my faith in the strong gains that we will soon enjoy again.
UNQUOTE |
