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

To: Jacob Snyder who wrote (66123)	9/20/2002 6:12:35 PM
From: Cary Salsberg	Read Replies (2) \| Respond to of 70976

Hi Jacob, I have some comments on what you put forth: 1. There have been recent signs that 3rd Q GDP will be stronger than expected, but it will be significantly lower than Q2, so you can stick to your W if you want. 2. Technology is not strongly linked to the economy, now. There are no capacity buys to speak of, only technology buys. In cash strapped sectors, there are very little in the way of technology buys. 3. A slow recovery doesn't mean monotonic with a small growth rate. It more likely will be mini cycles with higher highs and higher lows. Semi-equip bookings just had a mini-cycle move up off the lows. Hopefully, the mini trough will exceed $900M monthly orders. There is a close connection between under 0.18u wafer starts and new equipment orders. After an acceleration in Q2, semi revenue has slowed in Q3. 4. I think the semi-equip stock price collapse does not foreshadow a bookings collapse. It reflects the markets understanding that a new bookings up cycle will not be quick and strong and it reflects more modest valuations and bear market pressure. 5. Buy and hold is risky because it is dificult to know how long the effets of the bubble will persist and what kind of valuations will be accorded in this unusual and difficult environment. I erred to the side of getting fully invested and I set my buy ranges accordingly. The market has made my worse case scenario a reality and I have not been able to implement any mechanism to deal with it. I was better prepared after 9/11 but it didn't happen then. I have thought that year end '02 is the first possibility for a big up side move and I was more willing to be fully invested as time moved on. 6. When you exit at $20, I will sell covered calls. I feel that the pace of technology innovation is accelerating. The next boom will not be driven by software and hype like the dot.com phenomenon. Physical hardware will drive it and the product will be personal communication and control using the network. We will spend more time on these threads in video conference mode than typing text message mode. We will get to really know what your life in Alaska is like and you will see what a stroll on a Santa Cruz beach or a visit to Ground Zero looks like in real time.