Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 165.80

+3.6%

1:36 PM EST

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To: LK2 who wrote (1376)	10/30/1997 1:49:00 AM
From: Gus	Read Replies (2) of 9256

Well, it looks like this sector is toxic again. It also looks like it won't be the only one. It seems that the hedge funds/speculators are going to keep on renewing their attacks against the stubborn Southeast Asian economies that can't (politics) and/or won't (nationalism) move more quickly to adjust their overspending economies to the new realities which include but are not limited to the following: 1) 50% capacity underutilization in China = cheaper Chinese exports vs the other Southeast Asian countries which have currencies pegged to the incredible US dollar. This is the dark side of the long view that all the companies are taking towards the emerging Chinese market. Everybody is too willing to accept the early losses to gain a foothold on the biggest emerging market of them all. 2) The strong US dollar is also making Japanese exports more competitive against the Southeast Asian exports. I'm a realist. So long as these Southeast Asian countries have "kick me" signs posted all over, the hedge funds/speculators are going to keep on launching their currency raids on one side of the Pacific and using part of their winnings on the other side to pummel a nervous and aging US bull market, not necessarily to submission, but enough to create the volatility that they can exploit. A ruthless kind of money velocity, if you will. Patience is an absolute requirement now, but that was always part of the package, wasn't it? Along with capital preservation, etc.... I hear Jimmy....Jimmy Rogers, that is.

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