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To: Archie Meeties who wrote (10696)	6/7/2000 10:56:00 PM
From: cpabobp	Read Replies (2) \| Respond to of 78753

I don't think I'd be too concerned about an economic slowdown for CX. Mexico has been on an economic slowdown for centuries. I am a holder of both CX and LAF. I don't think we've seen much of a slow down in commercial construction yet, and heavy highway construction is on the rise...so I'd have to say an economic slowdown shouldn't have much of an effect on cement manufacturers as a group. Also, more importantly I feel that the anticipation of an economic slowdown in the US has already been factored into the stock prices. Also, I bought an initial position in SNH yesterday and doubled up today. Also bought TRN because of 2 really lame reasons 1) with gas prices continuing to remain high, what better way to ship than by rail? If that's so, rail spending may increase. 2) for profits on one of their smallest division (highway construction products) to help offset the cost of guardrail products I buy from them at insane prices.

To: Archie Meeties who wrote (10696)	6/7/2000 11:40:00 PM
From: Paul Senior	Respond to of 78753

Archimedes: re: "Do you think cement producers will be spared in an economic slowdown?" The stocks of cement producers will drop, imo. There are two other issues though (imo). How bad will earnings (or deficits) really get? When, or will, the stock of CX come back (up)? In discussing CX, we need to change our paradigm of what we consider a cement company. (That's what CX would like us to do anyway -g-). I assume we USA people think of cement as a bulk commodity item. (It's 95% bulk and 5% bagged in the US.) CX says they specialize in selling a branded item to the retail market- one bag at a time. (In Indonesia, for example, cement sales are 95% bagged, 5% bulk). 70% of CX sales volume is bagged cement. So for example, the "typical" Latin American consumer would buy the product, when he/their family - only had available funds and would build their house slowly, slowly --- maybe taking 10-20 years to do it. This consumer does not buy on credit, so interest rates have no affect in dampening demand (assuming the consumer continues to be employed). Demand is driven by demographics too. New additions to family may require a new room; helping other homeowners (family) as sons/daughters start families of their own. What this means for CX's business model -- and they are not the only large cement company playing this game -- is advertising for brand recognition, educating the consumer on how the product is best used, and creating brand loyalty, using exclusive and non-exclusive distributors. Also helping CX, imo, is that they have - from what I read- a very excellent IT focus. They know what each plant is producing and yielding, when, and under what process conditions. Information and maybe knowledge which I hope they will use to make better decisions and to be responsive to economic downturns in the areas in which they compete. My opinion is that given what I perceive to be long-term demand for the product, an increasing higher standard of living worldwide, CX's broadly diversified position across less-developed countries (They are here in the US as well), and CX's decent financials - I bet that CX stock will recover from an economic slowdown if/when it occurs. (Although it certainly is possible that the stock could drop quickly and stay down for quite some time; I hope I will have the patience and conviction to hold on if this occurs.) Paul Senior