For selling this time, I intend to follow Corrigan's recommendations:
Basically he believes that boom and busts follows technology cycles. One generation makes money, people piles in for the next one and so everybody lose money on the next generation. Exception is last time we got 2 losing generations because the Koreans understood this so well that they invested heavy in 96/97 with the intention of gaining market share when the next boom comes.
Lo and behold, they overbuilt so much they caused two busts technology cycles back to back.
And so here we are, I believe the 0.25um cycle will make money. The 0.25um machines can basically be tuned to do 0.25/0.21/0.18um. The 0.15/0.12um is another matter and probably will start the 12" wafer generation. The 0.18um should last into beginning of 2002, with the 0.12um ramping mid-2001. Hence I expect the stock to peak, and I to sell out, sometimes around or later than X'mas 2001.
There's always talk of how expansive the fabs are, 12" 0.12um may cost $2.5B to build, and as such, not enough will be built. I expect that when people start seeing how much money the 0.18/0.25um fabs can bring in, they will lose their heads once again and overbuilt for the 0.12 generation.
By the way, for myself, my sell indication may be when the newcomers get their money together to build the 12"ers. No dis-respect for anyone intended, but just timing. 0.18um to show how big bucks can be made and that anybody and everybody new should jump in, 6 months to get money together, 9 months to build fab, 6 months to ramp and drive to over capacity etc. etc.
patrick |
