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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: Proud_Infidel who wrote (35401)	5/30/2000 2:44:00 PM
From: Dr. Mitchell R. White	Read Replies (2) \| Respond to of 70976

Thanks for the info link, Brian! I haven't "crunched the numbers" strongly on it yet, but at a first pass I'd say that the dropoff in growth rate for IC sales, which begins at the end of 2001, will cause the book-to-bill ratio for semi equips to go below 1.0 at that point. Maybe Gottfried's charts can show this directly. It doesn't mean that sales or shipments of chips will shrink, but the sale and shipment of equipment looks more like the first derivative curve on IC sales, rather than tracking it directly. If that's true in this cycle, then we can see actual shrinkage of shipments of semi equipment tools begin as early as Q3/Q4 of CY2001. And the stocks tend to factor this kind of thing in about 6 months before that, and in often brutal fashion. <sigh> So if all those assumptions are true (I hope they're not!), then: A) We could see semi equipment stock prices take a sizeable bearish turn as early as Jan-Mar '01; so-- B) We need to get this current slump behind us and attempt to reach back towards the all-time highs (115 for AMAT) this fall. Only the Fed can help us get there, because the industry fundamentals can hardly be improved from here. Maybe Greenspan & Co. will clear out of the way ahead of the national elections, and we'll get time for a rebound? Me, I dunno; I'm still stocking my root cellar, just in case.... Mitch