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Technology Stocks : Semi Equipment Analysis
SOXX 360.46+2.7%Jan 28 4:00 PM EST

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To: robert b furman who wrote (38004)2/7/2008 9:25:08 AM
From: Sarmad Y. Hermiz  Read Replies (2) of 95790
 
>> if you aren't keeping up you'd better shift gears and get there quick or be left behind.

It looks to me that recent recessions are not doing the job they are supposed to do. Classic recessions are caused by over-supply, then weak producers go out of business, winners get stronger, profits increase, new entrants get in, economic activity picks up.

Then over-supply again, and the cycle repeats.

But this time no weak producer is going out of business. Have any semi-equip companies actually lost money in the past few years ? Apparently there is enough total revenue to keep everyone in business, as far as employment goes. But there is no profit for investors.

So as long as semi-equip companies do not need new capital to stay in business, there is no role for investors. And no justification for stock holders to make a profit. they can all go jump in the lake, as far as managements are concerned. If the corporation can keep going with no need for new external investment, who needs investors ?
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