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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: John Trader who wrote (57137)	12/9/2001 8:41:27 PM
From: Jacob Snyder	Read Replies (3) \| Respond to of 70976

John, Stocks have a good track record of turning up 3-6 months before the turn in business fundamentals. But, stocks usually give several false signals before then. So it's not a very useful signal; too many false positives. This isn't the first time in this bear market that the SOX has made a 50% upmove. All the other times, the SOX went on to lower lows. In spite of everything I've posted, I am quite uncertain as to how long the recession will last, or whether this rebound off the September lows is the beginning of a new Bull Market. I wouldn't be surprised at Nas 1000, or Nas 3000, in the next 18 months (or both). I can construct reasonable, detailed scenarios to support either of those futures. It is my uncertainty, rather than my certainty in anything I post, that leads me to hedge and raise cash (slowly, in increments, as I have little idea when or if a downturn happens). And, also, the fact that I have clawed my way back to close to my 2000 portfolio peak. This time (I vow) I'm going to keep a tighter grip (can you see my white knuckles?) on my capital (i.e., Capital Preservation is more important than Capital Growth). Losing half my wealth, from April to December 2000, was an experience I'll never forget, and will inform my decision-making permanently. I Believe (capital B) in technology, too. But that's only a longterm trend. Embedded in that trend, can be many downturns, some of which can last for years. re JNPR: 1. I believe (little b) the Gorilla Game thesis, that tech sectors are winner-take-all. And CSCO is clearly the established Gorilla. So, my expectation is that, eventually, CSCO will do to JNPR what they've done to so many other rivals, like Bay Networks and 3COM. I'm not competent to evaluate their products; I rely on their track records. 2. Consensus EPS for 2002 is 0.45. With earnings and sales flat year-on-year, I don't see how they are worth a PE in the 50s. 3. CSCO will be able to outspend them, in R&D and acquisitions. JNPR doesn't have the cash or cash flow to compete with CSCO, in developing new products. 4. JNPR hasn't outperformed CSCO. It's just a smaller-cap, lower-quality, and therefore more volatile, stock. Sure, JNPR has tripled off the panic-selling lows, while CSCO has "only" doubled. But JNPR has fallen from 244 (= the 2000 high), while CSCO has "only" fallen from 82. Sort of like the difference between EMC and NTAP, or the difference between INTC and AMD. If stocks head down, JNPR will drop three times as fast as CSCO.