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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: Ian@SI who wrote (9679)	4/12/2001 5:55:25 PM
From: WTSherman	Read Replies (1) \| Respond to of 10921

Ian, I wouldn't argue too strenuously with you about that. My main point was that right now the market is trying to rally on the basis of speculation about increased economic activity. That kind of speculation can only support the market for so long, it will take real evidence for it to move forward. I would disagree that it "all began with the Fed tightening rates". Rather I would say it all began when the Fed dropped rates in late '99 and pushed up the money supply enormously. This was apparently done out of a misguided fear about the costs and effects of Y2K problems. At any rate, it created a huge bubble in the market, started dramatic "asset inflation" and saw money thrown around by venture vultures and by established company's, too. I think people are going to be surprised at how rapidly corporate earnings are going to fall over the next couple of quarters. During the last 2 or 3 years of the boom company's increased their overhead dramatically by increasing comp for executives and skill workers(engineers, support personnel, etc.) that saw tech related comp rising by 10-12% a year. This is now built into these company's and isn't going to wrung out easily. We'll see how it all plays out, but, I think there's more downside risk than upside risk for a lot of tech stocks and particularly for semi's.