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Technology Stocks : Semi Equipment Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Pink Minion who wrote (3734)	6/29/2002 1:00:36 PM
From: Cary Salsberg	Respond to of 95520

There was a dot com bubble and a stock bubble. I sold 65-70% of my stock (mostly semi-equips) in 2000 because of bubble prices even while I did not think the semi-equip up cycle had ended. I have been telling people for at least a year that the next up cycle will be unusually slow and long while the bubble aftermath is worked off. I don't believe that semis and semi-equips are a maturing industry. It is true that the conventional silicon fabrication process that has driven Moore's Law will run up against the laws of physics in 10-20 years, but new fabrication processes for integrated circuitry will continue the momentum. It is true that capital equipment vendors in mature markets sell for low price to sales (<0.5) and low price to book (=1). It is true that telecom money has run out, temporarily. Fraud, greed, and stupidity have ground telecom to a screeching halt, but, technologically, it is still at the Model T stage of development. Telecom, networking, will work through the current mess and come back stronger. Money will not run out in the semi industry. It is much simpler than telecom. It is based on improving price/performance at an exceptional rate. It is implemented one production line at a time. Telecom requires huge capital investment up front for applications that have not been sold, yet. 300mm wafers have been on the back burner for years and the transition is still moving slowly and deliberately. You have an element of dooms day scenario in your analysis that seems disconnected with current reality. The market crashed, trillions were lost, companies and industries have gone out of business or are on the brink, unemployment has risen. In the midst of this economic turmoil, the country suffered its worst domestic attack and now faces continued threats. Even with an administration I am very unhappy with, the strength of the American people and the American system is evident. You rely too much on history, both economic and stock market. I know the "...doomed to relive it" concept, but I believe that we do know history and we apply the lessons to our current, different world.