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Technology Stocks : Applied Materials No-Politics Thread (AMAT)
AMAT 226.05+1.3%Nov 14 9:30 AM EST
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To: robert b furman who wrote (7482)10/10/2003 3:22:01 PM
From: Big Bucks  Read Replies (1) of 25522
 
Robert, It is good that Grove is acknowleging the problem.
Here is how I see the situation:
1. Past US corporate taxes were extreme and were responsible
for limited corporate re-investment in the US.
2. CEO and senior officer salaries have been outrageously
high for the real value added contribution to corporate
growth and have negatively affected corporate
profitability.
3. US labor costs have become expensive to maintain as
profit margins have decreased.
4. Once the growth rate of a product stops growing
exponentially and there is strong competition for market
share, the product becomes a commodity and margins erode
even as the technological capability continues to
improve.
5. The cost of doing business in a global economy becomes
more expensive because of the infrastructure
requirements necessary to support a global operation are
huge. (consider offices, salesmen, secretaries, cars,
and other intangible asset costs to conduct business
operations)

Personally, I think doing business in a global market is
over-rated because of the need for such companies to have
to support such a huge infrastructure, regardless of business conditions....
this is a massive drain on the profitability of international companies, unless they are
the only company in a niche and exponentially growing
market... BB
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