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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Patrick E.McDaniel who wrote (152618)	1/29/2000 1:01:00 AM
From: hsg	Respond to of 176387

From William Fleckenstien's "The Contrarian" The smell around Dell... Following up on the penultimate performance by the dead fish community yesterday, Mark Haines on bubblevision this morning made what I believe was an excellent point. He said he thought it was suspicious that analysts were coming out and raising their price targets after Dell said what it said, and that is smells like they are trying to prop the stock up. In contrast to what a lot of people are saying on bubblevision, Haines is pretty even-handed. A lot of people have accused him of having a particularly bullish bias, but I don't think that's necessarily the case. I think he is just trying to get to the bottom of things and how they really work and he does a pretty good job of sniffing out pure nonsense. Judging from the email that I see, if he makes both the bulls and the bears mad, he's probably doing his job. In any case, he offered an unbiased observation about yesterday's rating-game changes. In addition, I happen to have a friend who is a live-fish technology analyst at a major Wall Street firm (I will withhold the name to protect the innocent). He sent me an email that I think readers might find insightful: "As one wag told me, if we downgraded Dell the leader, then we would have to downgrade the entire group of PC vendors. Oh what to do...! Job preservation. Interestingly, Dell told our analyst only two weeks ago that Dell didn't see any of the Gateway issues of Y2K slowing and component shortages. "Also, the hue and cry is Win 2000 will cause a major PC upgrade cycle. I have to believe that the recently remediated, Y2K-installed base of corporate systems was made ready for Win 2000. A relative of mine works at MSFT, and is running WIN 2000 on 64 meg, unclear how many applications. But he says Win2000 is more memory-efficient than NT4.0, which it replaces. "Fascinating how little numerical analysis is being done on the Dell issue. The buzz is Dell low-balled the recast estimates and will beat going forward. No talk of what do you pay for a reduced-growth distribution company." So there you have it - the view from the inside. In the mania chronicles... "I am a broker at an independent brokerage firm in Southern California. A broker friend of mine who handles accounts for brokers in the firm who are out, got an interesting voice mail that I think you'd find very funny. The guy called up to say he was in Hawaii at 2 a.m. and wanted to buy stocks in the morning `because we had just had a correction.' This was the morning after the day the Nasdaq experienced its heaviest volume on record, Jan. 24. "Anyway, after this `correction' - his words - he wanted to buy stocks and was calling my friend because his broker was unavailable and he just had to buy. He wasn't specific on what we wanted to buy (I don't think it mattered) and he wanted to put the purchases on his credit card." I think the illuminating part of that mania chronicle, as with so many of them, is that it reflects the stories we keep seeing about credit card debt, margin debt, lines of credit people have used - all to buy stocks. I've received many, many more of these than I've shared and that seems to be the most staggering thing - the absolutely rampant use of leverage in all forms by people who arguably are the least equipped to use it. It's damn difficult for the pros to use leverage, as we've seen, like the Long Term Capital blowup. But the people who do other things besides investments for a living are being seduced into trying it.