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Technology Stocks : Dell Technologies Inc.

DELL 132.85

-4.1%

1:41 PM EST

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To: CRICKET who wrote (22536)	11/22/1997 11:43:00 PM
From: James Choi	Read Replies (1) of 176387

>Where does it end? Foreign countries will have to pull out of >U.S.Treasury holdings to try to prop things up at home >How long will the IMF be able to bail everyone out? That Yamaichi not having serious consequences is for the clients who deposited in Yamaichi account. The way Yamaichi will pay for them is by liquidating their assets. Unlike Korean companies whose debt is typically 4 or 5 times their assets, Yamaichi claims their equity can cover their debt. What is their equity exactly? Some of it is US stock and bond holdings. They will have to sell them to cover their debt. Yamaichi is the third, and the biggest, of the series of bank failure that is sweeping Japan, the powerhouse and the money house of Asia. The net creditor of the world. IMF is saying it is running out of fund to cover any future failures. Whether IMF can adequately cover Korean crisis is also a question. IMF can allocate only 20 billion but experts say Korea needs at least 60 bilion if not 100 billion to get out of its current hole. Korea will try to export its way out of the trouble. It is already selling steel at 50% discount in the southeast asia. Who knows when SamSung laptop will cost so low that people will forgo Dell for half priced Samsung. To make the matter worse, Japan competes directly with Korea in many areas. Japan might have to devalue its currency to keep up the competition. (Neithre country can survive a month without exporting.) If so, expect to see dirt cheap NEC and Hitachi and Sony computers. In no time the discount will eat into Dell's profit margin and Dell might follow the fate of Gateway before we know it. The Asian problem is deeper than what papers are making it out to be (after all, they don't want to create a panic situation) and it will be further reaching than what most people hope. Short GM, Kodak and anything that competes with Asian made products. James Choi

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