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To: Arthur Tang who wrote (1153)	7/1/2000 8:55:58 AM
From: Arthur Tang	Read Replies (1) \| Respond to of 1471

Current trend on Wall street? In equity investments, often market can be spooked by fear of fundamentals changing in the economy. In the past few months the fear of FEDS over doing the interest rate increase hung over the market. The market indexes retreated substantially. What Wall street failed to comprehend was that the analysts failure to understand that Greenspan and other FEDS presidents were listening to Wall street responses. So, when analysts moan and give in to FEDs, the die was cast. Wall streeters say increase Greenspan increased. Wall streeters now say stop, Greenspan stopped. Finally, the murmur of decrease of interest rates on Wall street is heard. In reality, the overnight discount rate which is the monetary policy, and whether to change the multiples of the rate, governs the way banks work. Banks can not tolerate changes because of locked in rates with their customers. The inconsiderate moves by FEDs have hurt the member banks since the 1970s. When you ask bankers how they make money, they say it is all overnight discount rate. They borrow by the multiples of their deposits, then they lend out to the customers. If overnight discount rate exceeds the fixed lending rate then they are forced to lose money by the multiples. It has nothing to do with slowing down the economy directly. Economy slows down by lack of demand. But demand can be accelerated by cheaper prices. Economy slow down forces cheaper prices and rebuilds economy stronger than ever. It has nothing to do with interest rates, which has to do with lack of money. Anyway, now Wall street is rebuilding the equity market. It started with Dow, then spreads to Nasdaq. Broadening the market so that all stocks will recover slowly. Before banks run into huge deficit, they are selling treasury bonds and buying stocks, to compensate Greenspan's mistake of forcing them to lose money. That has a positive effect on the stocks' recovery. Greenspan has to lower overnight discount rate to save his member banks, before it is too late. We can count on that too.

To: Arthur Tang who wrote (1153)	7/20/2000 7:58:40 AM
From: Arthur Tang	Read Replies (1) \| Respond to of 1471

Some one asked me privately to name a few companies to illustrate the technology shift? First I have to name a few causes of the technology shift. The foundation of the technology shift came from the advancement of deep submicron lithography technology. It brings cost and power plus speed to a larger number of applications. Communications field has been changed since the introduction of ultra dense wavelength and/or frequency division multiplexers, which will provide expanded broadband bandwidth. Cable systems will be made parallel to computer networks for unlimited broadcast push technology usage. Computer microprocessors will see 1.5 ghz speed next year. Memory chips are going towards 512mb each. Software is developing into high power server applications supporting thin client devices. All this just to provide the less skilled with information easily. This will enable us to give jobs to the previously considered unemployable. The last 4% of the unemployed can do work on thin client devices, just as efficiently as the ones previously on thick clients. Thin clients have the software on the servers; while the thick clients have their software on their own computers. The IT department will have less work to support the thick clients. With the thin client, the business will change to more ASPs(application service providers). All experienced workers will staff the ASPs; while all corporations will outsource their internal departments such as accounting, mailroom, exchanges(sales and marketing), human resources, (some day) engineering, product design, etc. to ASPs. This technology shift even though invisible at the present; it is felt in the slow down of older technology business already. Watch out, Microsoft just announced a $2 billion budget to enhance their ASP alliance with anybody who needs funding. Even Department of justice did not understand that Microsoft buys software, never did they originate their own. So, what forced divestiture on Microsoft will do is beyond me. However, the completion of this technology shift will take 5 years. You have to do your own research to take care of your future technology investments.