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

To: Adam Nash who wrote (51932)	4/20/2001 11:50:02 PM
From: TobagoJack	Read Replies (1) \| Respond to of 77397

Hi Adam, <<I'm not sure I understand why Cisco cannot continue to acquire products and companies ... need to see some core market stability and price stability in their share prices ...>> Could be that ... (a) core market unit volume drastically reduced in size for any given time frame due to over capacity in infrastructure and tightening capex spending, i.e. annual market size drastically slow in growth rate or even shrinks, (b) massive over capacity in production driving down end-user price per unit, ala DELL, GTW etc (c) leading to shrinking of absolute size of new-add pie, (d) coupled with fewer VC venture formation due to imploding exit avenue (no IPOs) and more competitive market place dominated by big boys such as CSCO (doing more of own R&D), (e) resulting in fewer purchase-able companies, (f) necessitating serious in-house research and development efforts, (g) with smart folks hired on cash compensation, resulting in higher cash cost, (h) further reducing E in P/E, and lowering P further ... It is possible, because the chain of logic is more powerful than the previous "virtuous circle" story. Minus the maestro's financial sleigh of hand, people and companies will have to revert back to working for a living. The temperature of the environment has changed, and evolution moved the goal post for survival. Chugs, Jay Disclosure: I still got a watch and brief residual position in CSCO, just to force myself to read the news.

To: Adam Nash who wrote (51932)	4/21/2001 7:45:27 PM
From: Jacob Snyder	Read Replies (1) \| Respond to of 77397

re: I think they just need to see some core market stability and price stability in their share prices, and you'll see Cisco acquire again. By the time they (and everyone else) is seeing some market stability, asset prices will be going up again. The best time to buy assets is when they are cheap, which means at the point of maximum uncertainty, in the macro or sector picture. And, it would be nice if they could do acquisitions without too much dilution. However, if you think you are in an industry that is not cyclical, with permanently high growth, then you expect assets will never be cheap. Which is what Cisco thought until very recently. Cisco bought lots of expensive assets in good times, and now has decided they are not in a position to buy cheap assets, during these current bad times. Maybe they see even worse industry conditions in the near future. So, why do you think they haven't made any acquisitions in 4 months?