TM: Mohan, as always, has it right....12% exposure, as owned up to by the company. That figure takes on more significance when one recognises that Asia was their "big growth expected" area for 1998. Also, the whole industry is getting both sluggish and very competitve. Everything I look at is suggestive of the PC sector of about one year ago...just about to REALLY experience the old "supply overwhelms demand" scenario. What a familiar refrain (a few of us have been pointing this out for quite some time now), and one that is going to become even more familiar as this Asian crisis deepens.
I've seen lots of examples of mass insanity and herd stupidity in this market over the last two years, but the current complacency with respect to the genuine meltdown occurring in Asia takes the cake. "Investors" (joke) ignore this at their peril. To me, it is one of the most significant and frightening series of events in the post WW2 era, and to see our markets essentially sneering at its importance, speaks volumes with respect to today's market participants. CNBC-educated investors are providing the last round of buying power on which the pros are taking their leave. This is retail-dominated buying...that in itself is a warning. Another warning is provided in the continuing importance attached to "the charts" even as the earnings capabilities of entire sectors fall off the map (example - Micron .....trading above its summer'96 lows even as memory sells at a fraction of that time period's price and well under cost-of production). Brilliant. Personally love it as it is providing another delightful shorting opportunity.
Whether this rally extends for another day, or week or month, in some respects is not terribly material....events in Asia spell out where we are all headed. Winter approaches in more than a seasonal way.
Best, Earlie |
