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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: bambs who wrote (47830)	2/3/2001 10:18:50 AM
From: Wyätt Gwyön	Read Replies (1) \| Respond to of 77400

Check out "The Trader" column in the latest Barron's for more interesting info on Cisco. A sampling... One Boston research-oriented firm, Fechtor Detwiler, has examined Cisco's exposure to troubled CLECs (competitive local exchange carriers), and its view is that Cisco Capital's problems are growing because CLECs are failing at a rapid rate. This exposes Cisco to loan losses and throws an appreciable amount of used equipment onto the market. "It's going to get worse before it gets better for Cisco," says Jack Whelan, a Fechtor Detwiler analyst. Whelan says the CLEC problem for Cisco and other telecom equipment suppliers goes beyond failed public companies like Northpoint Communications and ICG Communications. "There are hundreds of smaller privately held CLECs in the U.S. that are closing up shop at a quicker pace than their larger brethren, and much of their almost new equipment will find its way onto the used equipment market and compete with future equipment sales," the firm wrote recently. interactive.wsj.com Copyright © 2001 Dow Jones & Company, Inc.

To: bambs who wrote (47830)	2/3/2001 10:43:35 AM
From: Wyätt Gwyön	Read Replies (3) \| Respond to of 77400

I don't know what they'll do this quarter, but I don't think the near term or medium term are bright. The market agrees that the near term is poor, but is holding up the stock on the hopes that the "great second half" hope will become reality. Well, we should at least make a note that the prevailing belief at the beginning of 2001 was that the second half will be great. This outlook should be reviewed from time to time. As for negative savings rates, I'm not sure what it's all about. Lots of people taking capital gains have to pay the taxman a lot of dough, so they show up as negative savers. These people are not the concern, though. I am rather more concerned about the high leverage of your average consumer. I don't know what the weighting is between (a) the high-net-worth negative saver (basically a statistical negative, but a wealthy person in reality) and (b) the overleveraged consumer. That would be one key to a better understanding of this issue. It seems the bulls always talk (a) and are dismissive of the negative savings rate, while bears talk about (b). I would like to know how they balance out.