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Strategies & Market Trends : NetCurrents NTCS -- Ignore unavailable to you. Want to Upgrade?

To: TWICK who wrote (6769)	4/3/2001 12:57:06 AM
From: robert b furman	Respond to of 8925

Hi Twick, I think the inventory situation is the result of overbuilding and stuffing the distribution channels. In the last quarter it was tempting to disregard slowing orders and book production as profits.Now excess inventory has resulted in cancelations / pushouts and the need for working down wip/or finished goods. Depending on how close one had their ear to the ground the workdown could last 2-3 months to 2-3 quarters. So far the consumer has been the saving grace.However in the electronics world the summer time is not the time for a consumer to be strong in any year let alone a bad year. I think companies like Csco who acquired many new companies ,in an effort to perpetuate their phenominal growth could be even more "way out of line than those who have wethered a downturn before and know what to do - to batten down the hatches. I suspect we've just finished up hearing from the worst case scenario's as they confessed their problems in the preannouncement period. In another week we'll hear from those who've managed their inventories,and those who still have demand for their products. Bob