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

To: BWAC who wrote (38146)	2/14/2008 10:42:55 PM
From: Woody_Nickels	Respond to of 95737

You may well be correct. People have to compensate for lost home equity, and selling stocks may well be their method of choice. Not to mention that boomers may get more conservative investments as their retirement date looms. Woody

To: BWAC who wrote (38146)	2/15/2008 5:25:04 AM
From: robert b furman	Respond to of 95737

Hi BWAC, Well today is the last day of options expiry. It has been a brutal January followed by a very volatile February. Surely a traders dream and big profits for the nimble traders out there. NO BIG DIFFERENCE FOR LONGER TERM INVESTORS. The sub prime continues to get bigger as global banks puke out the toxic stuff, as it doesn't go anywhere except to 20 cents on the dollar and then you're hung with it until someone declares that even with foreclosures at least the land is of value and maybe even the house has replacement value.DUH What we're seeing is a going back to sound conservative banking values as the "new structures" have proven to be quite mispriced (make that no allowance for risk and its costs). Those banks that stuck to retail banking are not participating in the capital writeoffs and quite happy to announce it as such. Those who drank the new potion and its lure - are in search of new capital.What's not wanted is a stench in Wall Street and a belly up or two.Fear of a run ,that could well steam roll brings about politicos and more stimulus. What's apparent to me is "Deleveraging is a bitch".That really sums it up. Money is cheap everywhere,Resource commodities are rare everywhere. Globalization has coupled us all together and each and every one of us is fighting to have the lowest currency and the largest trade imbalance. Surely in a world of deleveredging almost all financial instruments lose in value.Banks are writing off their capital 80 cents on the dollar in so far as they are stuck holding mortgaged back securities.These securities are being rewritten at rates that are boosted 200 basis points,and that might not be enough - if they are insured @ AAA and the insurance companies may not be well healed enough to back up what they get paid for. So as the cycle goes completely around full circle,all monetary instruments get repriced.Governments print money.Gold goes to record highs and commodities have real value. Everything in the commodity world goes up and everything in the currency/financial instrument world gets deflation as governments print money and "back" institutions with next to no cost money. It all gets labeled sub prime but it really is more than that. Mergers and acquisitions have come to a halt,Was this subprime impacted - NO! We've had a cheap money bubble and it got unwound with the Fed's relentelss 1/4 point rise every meeting for 2 1/2 years. This finally created a top in M&A ACTIVITY as it became known that some might not get done.Everyone hurried to get their commissions and fees paid,and the top was put in last year. Now we have to live through the deleveraging of cheap money.This is being releived by guess what - cheap maoney again,but at a higher cost of funds. Sanity of the market place is being reached. This process has left small caps over sold and many industries priced at book values and surely below replacement values. Sounds like a really good time to get conservative and buy the mispriced value. My bet is that in the future we'll place a premium on strong balance sheets,great new products that are gaining market share,and maybe even like to collect a dividend or two. My bet is there will be low interest rates for longer than most think and the cost of capital will be higher then most will think.The difference is the spread that banks will make and they have some serious catching up to do. Those that didn't drink from the subprime cup will recover much more quickly and do some M&A GROWTH OF THEIR OWN. AS money leaves the bigger and safer BIG CAPS ,we'll do well to be invested in the smaller more conservative tech companies that also will be making strategic acquisitions with the still cheap money. Banks are always lookinig to make loans to those with enough assets, that failure will be at the lenders expense. It seems a rude lesson has once again gone full cycle. Banks should never make loans to people where they have all the risk.DUH and what blows my mind is that this has once again "Been necessary" to point out. A sad redux of the Savings and Loan debacle. Anyone remember whar the RTC stood for? The good news is that after this purge - we'll be set for another nice run up in equities,as many a base will have been reset. As for Real Estate and its tax free flipping profits - I think the cycle will be dead money for 6-8 years. Very much like tech has been. A major top has been put in and years of losses and writeoffs will grudgibgly be made. What we're seeing now is the Csco'S and JDSU'S WRITING OF BILLIONS OF INVENTORY THAT WILL NEVER BE SOLD. Then a long slow recovery of the strong will emerge,but it always takes longer. By month end we'll know the worst,as accountants opinions will be voiced in the annual statements about the nature of the companies assets. Sarbanes Oxley will actually have had a purpose. The USA firms may actually lead the way up ,as transparency is a virtue after so much crap has been hidden and forced into writeoff status. BWDIK Banks that paid didvidends and had low PE's where the stuff of retirement portfolios. Another popped bubble that has led to failure. Almost nothing is safe. Bob The one comforting thought is that tops don't start from where we are. We are in oversold territory and just when it looks its worst - is most likely a great buying time. SCE's have balance sheets that are made of bricks. A deferral in Capex is occuring.Fab utilization will skyrocket as margins grow.We'll see a very nice reversal in the next 6-9 months and profits will be a big part of the picture. I still say this is 1998 all over again. Just as the Asian contagion had nothing to do with tech - it delayed investment and set up a great recovery. In between all stocks got cheap and beautiful long term bases where made and subsequently broken out from. That's about where we are now. IMO Bob