Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Applied Micro Circuits Corp (AMCC) -- Ignore unavailable to you. Want to Upgrade?

To: Jack Hartmann who wrote (1333)	2/11/2001 12:24:45 PM
From: Raymond Duray	Read Replies (1) \| Respond to of 1805

Jack, The sector will drift down until someone reports a pickup beyond flat guidance that seems to be forecasted for the first half. Yes, I do agree. While the Fed is adding significant liquidity to the money supply at present, I'm afraid that AG failed to anticipate how severely the mood of the country could swing in short order. Coldest November and December in recorded history for much of the US, leading to extraordinary energy bills, the demise of the dot.bombs, and general fear have had a severe impact on the mindset of many. And yet, VIX seems stable, put/call ratios aren't terribly high and the investor seems sanguine about the situation somehow. I've been in the bear camp since last April, and thus correct in interpreting the future. However, I'm getting tired of being a pessimist and want to see a corner being turned. I don't, actually, quite the reverse, I see a drastic contraction and consolidation in the CLEC and DLEC sector this year. I see John Chambers efforts to extend vendor financing to weak hands last year as a policy that was good for a one quarter blip in the CSCO chart and will come to haunt Chambers in later quarters of this year as some of his customers enter Chapter 11. I'd like to think that we'll recover quickly, but my gut tells me that we've still got a tremendous overhang of over-investment in telecom and that there's a lot more pain, before we see the gains that Dell'Oro, Forrester and RHK, among others, are projecting. I see all their rosy scenario forecasts being scaled back by the end of the year. The huge projections of growth: (see RHK datapoint - rhk.com ) defy the fact that in 2001, sales of long haul DWDM generally will be flat with 2000, according to CIR. Someone is "painting the tape" as it were, and it is not CIR. Without a rapid explosion in the uptake of PCs in unlikely places like Roumania and Nigeria, and without the explosive growth of xDSL, these sorts of geometric growth projections are just so much pie-in-the-sky. AMCC's growth is going to slow dramatically, I fear, from the torrid pace of the last couple of years. Still a great company with great management, but the industry is turning sour and there's little that David Rickey can do about that. Best, Ray