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

To: pass pass who wrote (49810)	3/11/2001 1:24:16 PM
From: Maher Sid-Ahmed	Read Replies (1) \| Respond to of 77400

The CEO's of INTC, MSFT, CSCO, SUNW, ORCL which are the bellwether of technology companies are all saying we are in recession or slowdown or whatever negative adjectives to describe the US economy. Big companies like XRX, LU, WCOM, AT&T are having a money crunch. Looking at the general picture it looks almost hopeless. when things look the bleakest it always the best time to invest, and that is why the true gurus of Wall Street including Abbey Cohen are 100% invested. I am not saying, however, that CSCO is a good investment. I really don't know. All I can tell is that CSCO based on accepted norms (p/e, p/s, etc.) is still expensive. The market cannot afford it a forward p/e of over 50 when its sales are shrinking.

To: pass pass who wrote (49810)	3/11/2001 6:06:53 PM
From: Rob S.	Read Replies (1) \| Respond to of 77400

The effects of lowering or raising rates is always delayed by several months. The last rate increases weren’t needed, even to burst the bubble of the crazy tech stocks because of the effect that rising gas prices had in slowing the economy. I think we are on the same wavelength . . .maybe if we keep posting some of the "techs to the moon and beyond" idiots who are blaming everything on interest rate increases by the FED will finally get it. The increased interest rates were only a small part of the problem that Cisco and other fat pig stocks have recently had to own up to. As yourself this: if the market for Cisco's products delivered an overwhelming profit proposition and was so vast that it could not possibly be satiated short term, then what difference would a rate increase or decrease have? Put another way; was it primarily because of low interest that Cisco and other investment darlings found high demand for their products and even higher demand for the stock? Of course not. What is the problem is that the underlying assumptions about the near term size of the marketplace and the compelling nature of the technology investment have been upset. A year ago the mantra of "growth regardless of profits" was still in control of corporate decision-making. The telecomm industry had not quite admitted that spending lavishly on infrastructure was not paying off as they had expected. And BTC and certainly BTB ecommerce businesses had not realized that the Internet did not guarantee that every business plan had merits or even that the basic paradigm was necessarily profitable or strategically compelling. What has changed for Cisco, besides the reality of a macro economic slow down, is the more chilling truth that some of the compelling rational for front-loaded expenditures on Internet and communications infrastructure are at the least premature and at worst totally erroneous. The degree of this problem won't be totally understood for months to come but it is now abundantly clear, (except to total lame brains imo), that the rosy scenarios for industry growth, regardless of whatever might happen to interest rates, have proven false. Lower interest rates by 2%, it won't change the basic pictue that dot coms have become dot bombs, long distance is overbuilt and only marginally profitable, and broad band access must evolve along with compeling content before it becomes a driver of growth that can hope to propel Cisco and other stocks prices anywhere near their previous highs. Until there is a new compeling outlook, the current outlook will worsen and it will be "seel into rallies" rather than "buy on dips" for the infrastructure darlings.