Punting on 4th and 2 (to Dale and Michael):
Dale:
I'm far from the most knowledgeable around here and, despite the likelihood this may be a distinct advantage, I really don't have a clue which companies will fail. My familiarity with KLIC - the fact that it was debt ridden/leveraged as a result of highly promising but as yet development stage technologies (Flipchip is still rolling out) at precisely the wrong time - was the basis of my call with that singular company. My speculation that many other companies will also fail is based on the logical assumption that some, perhaps the majority, of companies produce overlapping products. In a stagnant, if not contracting, IC environment this is, er, problematic. The observation that 23 of 37 (62%) of the SEM stocks I follow are now less than $10, 41% are less than $5, suggests to me the precipice is already in the crosshairs for many.
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Michael:
While I have great difficulty with the numerous premises in your post (what could you possibly mean by 'this stage of the cycle'...since we've been here, in effect, for 2 years) I won't bore you or the thread with more of my rantings.
My only comment is a statement of the obvious: my status as a non-shareholder presents a perspective that not only eliminates forced optimistic scenarios but revives painful memories when I would participate in the practice. I read your post as shareholder-skewed - as well you may have read mine as overly pessimistic. Michael this cycle is already different, far worse, far deeper (and there is still virtually NO visibility) than anything before...and it serves nobody's best interest to try to pigeon-hole this into a paradigm that it doesn't match.
If I were a shareholder I'm sure I would be couching the current environment in an historical framework etc. in an attempt to buffer the severity of my portfolio contraction. However, I feel it is necessary to forcibly absorb all the data around us and contemplate the possibility that the growth in the IC markets during the closing decade of the 20th century was not simply extraordinary but was anticipatory for a future expansion that has not materialized.
So, in the end, you may be right about cycles...with the debilitating proviso that your criteria are stretched to include a trough of 4-6 years. |
