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Strategies & Market Trends : Roger's 1997 Short Picks -- Ignore unavailable to you. Want to Upgrade?

To: CalculatedRisk who wrote (6062)	10/24/1997 5:57:00 PM
From: Graeme Smith	Respond to of 9285

Bill, I think that the current tech correction may last for another month or so. My portfolio is currently 2/3 long, but luckily over the past couple of days my Zitel and DDIM shorts have kept me roughly even. Next week I'm going to sell off about half my longs and use that money to go to a 2/3 short position. I agree with you, Y2K definitely looks very weak at the moment. No need to guess where most of my short money will be going. I don't know if I will hold my shorts for the entire 2 years. If my guess has been lucky and this correction does play itself out for the remainder of the quarter, there should be some great bargains by the end. I also think that early next year Y2K may have another run up on hype. >> Notice the discussion of the "after Y2K" business Interesting article for that very reason. Maybe this is the end! Once analysts start looking at the Y2K time frame they will stop giving Buy ratings to companies with forward PE ratios of 40 on '98/'99 estimates. With a thousand companies and 100 thousand programmers competing for what little maintainance and support work is required after the year 2000, being profitable will be almost impossible. Companies like DDIM would be best served by just shutting up shop and being happy with their winnings. Even companies like CHRZ are being a little optimistic. After 2000 the market for legacy systems maintainance will have been significantly reduced, many companies replacing their systems with client/server. Yet the number of players in the market will have at least doubled as a result of Y2K servicing. Graeme