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Technology Stocks : Advanced Micro Devices - Moderated (AMD) -- Ignore unavailable to you. Want to Upgrade?

To: DRBES who wrote (118395)	4/5/2004 10:34:20 PM
From: niceguy767	Read Replies (1) \| Respond to of 275872

Love that conventional wisdom. Ah yes, conventional wisdom does by definition have 20/20 hindsight. And for some, it's much easier to accept than what appears to be currently evolving in the here and now!

To: DRBES who wrote (118395)	4/5/2004 11:31:35 PM
From: dougSF30	Read Replies (1) \| Respond to of 275872

Hmm, I guess he hasn't noticed that AMD has been surviving long-term with just such an imbalance... Doug

To: DRBES who wrote (118395)	4/6/2004 12:31:39 AM
From: jlh682	Respond to of 275872

Follow up to Conventional Wisdom: Research and development is the way to win Companies chasing bigger and more profitable competitors do have a way out of this no-win trap. It’s called research and development. Come up with new and better products, as AMD has been doing recently with its Athlon and Opteron processors, and you’ve got a chance to fight and win against a more efficient, more profitable competitor. Despite Intel’s edge in manufacturing and capital spending, AMD has taken market share from its archrival. Which is why the big battle right now is over research and development spending. And why the best way to separate the winners from the losers in a winner take all stock market is to look at this key financial number. The ferocity of the battle between Intel and Advanced Micro Devices right now shows up in the trend of research and development spending at each company. Intel, through the technology crash and into the recovery, has kept its R&D budget almost constant: $4 billion in 2000, $4 billion in 2001, $4.1 billion in 2002 and then $4.2 billion in 2003. But as Advanced Micro Devices has seen a competitive advantage created by its newest products, the company has sought to push that advantage to the limit by massively upping its R&D spending. It jumped from $650 million in 2001 to $816 million in 2002 to $870 million in 2003.

To: DRBES who wrote (118395)	4/6/2004 4:42:59 AM
From: TGPTNDR	Respond to of 275872

Drbes, Re: <Love that conventional wisdom. > Great stuff. A lot of money to be made there. Remember One-Decision stocks and the 'Nifty 50'? The term One-Decision is coming back into use. Do a look-up on it and you get current results. I thought that term was buried for good in the early '70s. Not enough old farts around. In the 1970s, Wall Street's pros vowed to return to "sound principles." Concepts were out and investing in blue-chip companies was in. These were companies, so the thinking went, that would never come crashing down like the speculative favorites of the 1960s. Nothing could be more prudent than to buy their shares and then relax on the golf course while the long-term rewards materialized. There were only four dozen or so of these premier growth stocks that so fascinated the institutional investors. Their names were familiar—IBM, Xerox, Avon Products, Kodak, McDonald's, Polaroid, and Disney—and they were called the "Nifty Fifty." .... So what if you paid a price that was temporarily too high? These stocks were proven growers, and sooner or later the price you paid would be justified. In addition, these were stocks that—like the family heirlooms—you would never sell. Hence they also were called "one decision" stocks. You made a decision to buy them, once, and your portfolio-management problems were over. Partial exerpt from us.etrade.com Note,however, that their later statement, To be fair, however, I should point out that the problem was not with the companies themselves. Investors who bought those same stocks in 1980 made handsome returns (well above the market average) through the end of the century. is, to my mind disingenuous as the buy/sell rules to produce that result were fairly exotic and unlikely to have been practiced. During the '50s US Steel was King. During the '60s I advised my dad to buy some Toyota and was told 'the commission costs more than the stock'. (True in those days at Merrill Lynch and, I'd guess most brokerages.) A similar thing happened to me when during the middle '80s I asked my broker to buy me $1000 of TELMEX ADRs(TMX), then selling for ~$0.25 and was told they didn't deal in cheap foreign stocks. Ah, well, time for a new broker... Re: <This isn’t a game that AMD can win. Over the long term, this kind of imbalance results in a winner-take-all industry.> I'd say the odds of 'winning' are stacked heavily in Intel's favor but the pay-out can be really nice if you get the right underdog... For those who say the risk in selling short is infinite I'd agree but say the probability is negligable. Many stocks have gone to zero while I can think of none which have gone to infinity yet. -tgp