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Technology Stocks : John, Mike & Tom's Wild World of Stocks -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (1955)	10/26/2000 2:10:08 PM
From: John Pitera	Read Replies (1) \| Respond to of 2850

Cramer has the bear claws out.......... Remember Komag? Think JDSU By James J. Cramer 10/26/00 11:49 AM ET Click here for the latest from James J. Cramer. During the halcyon days of the disk drives, we used to monitor all of the component makers the disk drive companies used. We knew they would swing wildly because there was always a supply-demand imbalance in the system. To a person, not one of those companies ever saw a downturn coming. Not one. They were the last to see. Always. They were always blindsided. It was their nature. They were blind as moles. Here is why. You must understand this if you are going to trade the JDS Uniphases (JDSU:Nasdaq - news - boards) and the Corning Glassworks (GLW:NYSE - news - boards) of the world. You take a company like Komag (KMAG:Nasdaq - news - boards), which is a component supplier to companies like Seagate and Maxtor. If you just listened to Komag you always thought things were smoking. At the top! That's because Komag was always the end of the line. Komag would get big orders when Seagate had big orders. Seagate would get big orders when Compaq got big orders. If Compaq were to see a slowdown, Komag didn't see it for months! That's how it works in this JDSU world. JDSU is making things flat out because its customers are making things flat out. I fully suspect that JDSU is going to report a great quarter tonight. But JDSU's customers are just beginning to feel the slowdown from the problems in capital expenditure at the big customers, the large telecommunications companies that put in all of this stuff. Those companies donýt need any more of the stuff made by JDSUýs customers. JDSU will learn that soon. Not soon enough to help you. But soon. JDSU is Komag, you see. They just don't see underneath. They can't. They will be the last to know of the slowdown. The last to know. They will tell you that all is great because it is. For now. But we trade on the future, not the now. And the future looks dimmer because of calls like WorldCom's (WCOM:Nasdaq - news - boards) this morning, where capital expenditures are going down, and because of the vanishing of the cheap financing through junk bonds that the brokerage houses haven't spoken up about yet. Where are the next five points of JDSU? Beats me. What is the future of the telco business? Not as good as it was before. That's all you need to know. Like with disk drives, that's all you need to know.