Dipy and Rairden: As someone who has benefited from being in a country that was on the "losing" side of a war (The Cold War) with the United States, I want to tell you that there is much to look forward to, and that history may well look as favorably on George Bush as it does the great Ronald Reagan. Much of the fears of today remind me of twenty years ago when I was in college in Poland. Reagan was a war monger who was pushing the war toward war. Once Reagan became President, the world would deteriorate. And America knew that it was in a "malaise" because it's own President had told them so.
Today, there is much to look forward to over the next decade. Most importantly, we well attack Iraq and quickly overcome Mr. Hussein. After that we will have a multi nation presence in Iraq, and from there we will bring stability and some form of democracy to the region. While there will be isolated terrorist attacks, for large scale terrorism to succeed, it needs a host country. After all Al Qaeda means "the base", and without a host country, the prospects of large scale terrorism are significantly reduced. Iran will pose less threat because it's democratically elected representatives will gain more power, and these people are far more moderate.
Indeed, the battle is not really as much a battle of Islam versus the Infidels as a battle for Islam, whereby we are seeing an increasing secular Islamic society wherein women are given far more control than they previously had. And this is why fundamental Islam is committed to terrorism. They are losing control over their families; over their countries; over their religion. And perhaps most distressing, they will be losing their economic clout over time as new technologies work their way to market and replace the need for oil. This in turn means that the economic importance of the middle east will become less and less. How important is oil to the Arab world? There are 22 Arab countries. In 2001, the combined GDP of these countries minus oil revenues was $40 Billion dollars. That's about the GDP for the Chicago area. Absent oil revenues, these countries are pathetic. These are vast areas where people are essentially on welfare. This includes are so-called allies like the Saudis. They have no real manufacturing base, nor do they have any real internal capital structure, so going forward we are looking at the possibility of a very poor world (without any real home base) waging a war on the well off countries. It's not going to happen. So, the war on terrorism will be won in the Middle East. (How's this for a side bet Dipy? I am willing to wager that Bin Laden is "accounted for" before your Russell 2000 portfolio goes to positive.) It's also silly for Muslims to claim that they have a war against Zionist expansion. There are all of 15 million Jews in the world. By the way, the "war" on Zionist expansion is being won in the United States by Jews themselves. They are simply not reproducing in rates sufficient to maintain their numbers. Given the terrific contributions of Jews to America, that is truly sad.
Then there is Korea with a well defined return address. The question there is really how reunification will happen, not when.
Finally, there is the China deflation problem with 125 million educated and unemployed Chinese. And this will create downward pressure on technology prices. But there is also the emergence of a huge consumer market in China, which even now is becoming a growing consumer market. So the issue is now what is the cost of replacing a company like LSI Logic, since there will be an increasing need for the kind of product it makes. And the answer is that if you wanted to replace a company like LSI, you couldn't do so for less than about $6.00. As such LSI is a great buy at this price. Most importantly, I see all kinds of reasons for an increase in LSI's business. These include the following: 1. A real increase in investment in the telecom industry, which is inevitable since the industry is well behind its replacement cycle in many key components. 2.The Y2K "problem" placed a greater than usual cyclical element into the technology environment, and it will soon be time to make replacements for Y2K equipment. In anticipation of that, the market will go up. 3. LSI in particular will go up, since they made it very clear that their second quarter revenue stream will be far better than the first, and since LSI essentially sold off from $6, it is very likely that LSI will at least return to that level.
In retrospect the Y2K problem was typical of the cowardice of the Clinton administration What happened in 2000? The problem was that the Clinton administration was so focused on its daily polls that it failed to even come close to addressing the underlying problems that we were facing including terrorism. Mr. Clinton failed horribly in addressing the threat of Bin Laden. Absent throwing a couple of missiles at the guy from 2000 miles, he did nothing. And his excuse was as spineless as it gets. In 2002 he told Time Magazine that the reason he didn't take further action against Bin Laden was because he didn't want to influence the 2000 elections. Think about it. That's HIS reason. He should be ashamed of himself. When you are President of the United States, you are responsible for the country until noon January 20th of your last day in office. Instead what we got was preparation for Y2K, which was a very large part of the end of the bubble, (and was Jock's reason for selling since he felt that earnings would peak in the quarter following Y2K.) However, neither candidate in the 2000 election did much to address the fact that we had gone through a bubble and that all economic projections were unrealistic.
So much for some random thoughts
HRHLJH & MS |
