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Politics : Idea Of The Day -- Ignore unavailable to you. Want to Upgrade?

To: Jorj X Mckie who wrote (29422)	10/21/1999 7:04:00 PM
From: Lee Lichterman III	Read Replies (2) \| Respond to of 50167

You pose an interesting dilemma. One could argue that Y2K expendatures would take up demand for other IT projects so that there would be a boom afterwards, or you could argue that after Y2K, there will be pent up demand for upgrades that were held off etc etc. The problem is not with the service providers but with the companies themselves that are the buyers. How much of today's and 4Q "better" earnings will be from NOT spending on system upgrades due to Y2K fears and how much will the spending on the delayed programs impact earnings after Y2K is over. In other words, if I spent 10% of my budget on IT and then for two quarters I lock spending down so I can ride the last half of the year out. My earnings will look 10% prettier than the last 6 months either causing the appearance of better returns or masking problems of slowdowns in business etc. ( note how many earnings this quarter were good but revenues were under expectations). Now the first quarter of Y2K, I have to start spending at least the original 10% on better IT to catch up and I might have to spend more than that to catch up faster. What will that do to my earnings come reporting time next spring????? I don't know myself but this whole Y2K thing is an octapus with many alleys causing a maze of areas requiring exploration. Next spring may be a time to move out of hardware customers and into hardware providers where as now is the time to get into customers and out of providers. The whipsaws are fast and furious as sector rotation is getting faster than at any time I remember. Basic consumables for two days, Semis for a couple, Banks for 2 days, then services, then internet. Not a market for the slow. Aren't P&F indicators getting near a low area where they almost have to reverse soon. Anyone look at a bear market time period to see how they act if the market just keeps dropping???? I think both BPs are nearing the 30 area aren't they? Good Luck, Lee