This exerpt from Barron's on 98's "losers"
">> 1/2/1999 From Barron's round-up on 98 losers:
<<Another group that has suffered mightily from the Asian crisis is the heavy equipment makers like Deere & Co., down 46%, Caterpillar Inc., off 6%, and Case Corp., down 66%. Not only has the reduction in demand from Asia for combines and tractors dropped, but world grain prices fell unexpectedly this year, forcing U.S. farmers to scale back their purchases as well.
The result: The Dow Jones heavy machinery group has slid about 35% this year, positioning the group at 92.
And the end of the troubles isn't nigh, according to Karen Ubelhart, a Goldman Sachs analyst. Agricultural-equipment sales could be down 15%-20% in the U.S. and 10% globally in 1999, she says.
STILL, SALOMON SMITH BARNEY ANALYST TOBIAS LEVKOVICH SAYS, THE FARM EQUIPMENT MAKERS LIKE DEERE, CASE AND AGCO, THE HARDEST HIT IN THE GROUP, MIGHT ACTUALLY BE THE MOST INTERESTING SECTOR NEXT YEAR IF THERE ARE ANY SIGNS OF ECONOMIC RECOVERY IN ASIA. A TELLING SIGN OF A POSSIBLE BOTTOM FOR THESE STOCKS: THE SHARES NO LONGER FALL ON NEWS OF EARNINGS ESTIMATE CUTS.>>
Agree that subsidizing excess capacity to insure food supply is definitely necessary..we could have a repeat of adverse conditions like dust bowl of 30's [Recent research has even located evidence of 20 - 30 year super droughts in the past] If congress ignores this history and allows Darwinian economics to rule the farm economy, it could get ugly...for us and for them: 100% of registered voters eat - no exceptions.
Cats: Tubby Smith has done a fantastic job. |
