Z,
"Hopefully Samsung's losses will make them less willing to ship dollars with drives."
Another positive out of a negative may be found in the following quote from an article on the Korea fiasco:
"The other big U.S. ratings agency, Moody's Investors Service, already had cut the long-term rating on Samsung Electronics to Baa2 from Baa1 Wednesday. Moody's said that in addition to economic problems in Korea, the company also faces overcapacity in the memory segment of the semiconductor market. A shake-out of weaker competitors hasn't yet occurred."
One would hope that as they are deeply implicated in the DRAM mess, the Koreans will back off from helping to create yet another disaster in the drive sector. They may rethink trying to "outlast" companies like SEG, QNTM, WDC and IBM, not to mention Fujitsu, Toshiba etc., and either get out of the drive business altogether, or at least tone down their apparent ambitions (i.e., Samsung's alleged ambition to be number 3 in the drive business by year 2000).
I know it sounds more than a little crazy and perhaps masochistic right now, and most likely we haven't seen/heard the worst of it quite yet, but I do believe that the sun will shine brightly on this sector sometime next year, and patient buyers of these stocks at these prices will be well rewarded for their risk taking.
Sam |
