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Politics : Formerly About Applied Materials

AMAT 322.32

-5.6%

Jan 30 9:30 AM EST

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To: Bill Morel who wrote (8754)	10/17/1997 12:22:00 PM
From: Proud_Infidel	of 70976

Re at the end of a technology run. The first earnings from 300mm have yet to be realized. As James Morgan says "We are in the third inning of the technology age." The thought that we are nearing the end of any LT cycle in regards to chips is ludicrous and short-sighted, reasons we are currently seeing the extreme panic exhibited by the MM's. These guys IMO, have no imagination and have little idea of how different the world will be only five years from now because of the rapid pace of technology and the world it will change from what we now see. ReTech is fundamentally driven by software Operating System upgrades. People will stop buying computers because Win98 is not "huge"?!?! I guess it follows that people will stop buying cellular phones because there aren't any significant advances coming in the next year. Or nobody will buy toasters since there are not any improvement on the age old design. That is errant logic IMO and one which could lead you away from buying opportunities such as the one we are now seeing. During these downturns people often extrapolate that current conditions will be carried forward indefinitely a la INTC's poor earnings. It is difficult to separate facts from noise during these times since much of the noise is coming from the "experts." Just my .02, but I believe AMAT will blow out earnings and this will be at best a bad memory. They have already reiterated their expectations that eps would be met. Morgan & Co. aren't idiots, they know how to play the expectations game. Coupled with the FY98 CC, I hope to see AMAT in the 60'2 within 2-3 months. Would AMAT be spending 500M to upgrade their Texas facility for increased production unless they saw orders on the horizon? Would they have their employees working OT to fill orders if things weren't that rosy? And if the semis are in a downturn, why would they post 1300+ jobs on their website to only add to their payroll? It is simply amazing to me that the MM's are surprised by historical seasonal weakness. Sorry if I ranted. During these times one needs to remember why they bought the stock. brian

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