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Technology Stocks : Qualcomm Incorporated (QCOM)
QCOM 175.79-1.9%1:44 PM EST
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To: limtex who wrote (6714)12/27/1997 10:24:00 PM
From: Frank Byers  Read Replies (2) of 152472
 
On the contrary, I don't think the Koreans are original thinkers and will have a hard time getting out of this debacle they've spent themselves into, unless the western nations that hold their bad debt decide to write off the debt so Korea can start spending wildly again.

I believe the Micron statements about bailing out the Koreans being bad for certain US companies' is true. These companies have wildly overinvested in capacity in the few industries where they could do so effectively and capture market share, but at the expense of margins and the slightly important point of making a profit. They don't make money, and thats why they are in trouble.

QCOM has profited by the Koreans habit of buying and copying others technology. Did the Koreans invent anything, NO? Will they erode QCOM's market share, YES! Will either the Koreans or QCOM be making money on CDMA cell phones in a year, maybe. But watch the margins for both erode as more Korean phones come into the market and everybody starts fighting for market share.

I think Korea is more that just a IMF loan away from returning to it's former self. I wish them well, but they can't run a business worth a damn. Someday you've gotta rationalize your capital expendatures and make a profit, and that day is NOW for them. They aren't going to get any more easy loans from their political-influenced banker friends and therefore they've got a big problem. They've got to start innovating and becoming productive, and learn how to make a profit.

good investing in '98
FB
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