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Politics : High Tolerance Plasticity -- Ignore unavailable to you. Want to Upgrade?

To: Second_Titan who wrote (7300)	9/1/2001 4:04:51 PM
From: Warpfactor	Read Replies (2) \| Respond to of 23153

I realize that I am assuming some risk with a high tech position, Que. Here is some of my thinking: 1) If the markets rebound as I am positioned for, the NASDAQ will lead. High-Beta stocks can snap off of a bottom in a big way. Since I really don't know where else to go, I have chosen SPY to represent the rest of the market. This is my largest position by far. However I have been watching some biotech and may go there. 2) Some techs will not participate, due to overcapacity issues you mention. But we've gotten to a point where some tech stocks are quite cheap. Many will not survive, but look at others balance sheets and I realize that by just hanging around, developing new next gen technology, streamlining operations, that these stocks can double or triple very fast from their current levels given a more optimistic economic outlook. Look at NUFO and ITWO for example. ITWO merely needs to hang around and wait. Their current cash burn rate will allow the cash pile to last years. Yet, the stock has been in a death spiral, lumped in with the rest of B-to-B. Many wont come back, the stong will. I'm guessing that when the markets turn around, ITWO double in a hurry. Of course I could be wrong. 3) Looking at capacity issues, remember that the stock market is a discounting mechanism - projecting the economy 6-9 months in the future. With sales picking up for some of these techs, the profit flowing to the bottom line could magnify as streamlining and cost-cutting work their magic. Then of course years from now when the techs get fat and bloated again, reduced sales will magnify the loss. We shall see. By the end of September, I will probably be either much richer or much poorer. We will probably find out next week which way the money manager will take us. BTW, I recently picked up some energy - small positions in ESV and APC. Figure those APC insiders must know something good.