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Technology Stocks : All About Sun Microsystems -- Ignore unavailable to you. Want to Upgrade?

To: Bill Fischofer who wrote (44504)	8/18/2001 6:37:47 AM
From: Steve Lee	Respond to of 64865

Considering how much debt individuals and companies have, and how much spare capacity there is within the technology manufacturing industry, I don't see this being over with in 2 yrs. You are right that psychology is involved. The fed doesn't want everyone to stop buying all at once. I believe they are massaging the numbers. I believe last quarter's GDP was negative and stated that view before they came out this week and revised it downward to 0.0%. I believe this Q is worse. You know what 2 Q's of negative GDP growth mean??? Of course there will be rallies over the next few years. But the valuations are still too high in stocks and real estate. When people feel the pinch in paying back their high levels of debt, especially with the recent spate of remortgaging, they will spend much less. That will make the current slowdown look tame. We will have a manufacturing AND consumer recession. And we will still have overcapacity. I don't think we will see healthy consistent growth for 5 - 7 years. Maybe I am wrong but I am putting my money where my mouth is. I am selling a good chunk of the properties I have in the UK and investing some of the money in cheap beachfront land in Greece. In terms of stock investing. I hold puts and intend to take profits when they are offered, and reload puts or shorts on the rallies. My chosen vehicles for this trading are QQQ and MU. If SUNW breaks downward thru $13, which I expect next week (OK, so I keep saying "next week") then it will have a job getting back up above current levels where it has been bouncing along for a while. It might become a good channelling stock between $8 and $13. I don't see any prospects for SUNW's earning to hit a level to justify a higher valuation anytime in the next couple of years. It may go much lower. We are still in the bubble, despite recent declines. Just as valuations can overshoot fair value in good times, they will surely overshoot to the downside over the coming year(s).