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Pastimes : Ask Mohan about the Market -- Ignore unavailable to you. Want to Upgrade?

To: Dwight E. Karlsen who wrote (8230)	11/17/1997 8:57:00 AM
From: Zeev Hed	Respond to of 18056

Dwight, your comment is quite correct (in that there is a tendency to to say the market is "wrong" because it did not follow the "logical script"). In retrospective, I should have paid more attention to the blushing turnips, (the SOX bouncing from a major support and MU's little white candle, on one hand and the relatively low bull to bear ratio here on SI), but the asian problems blind sided me. In any event, the major question is whether we retested successfully the late October lows or are we going to revisit lowe lows in the next quarter. I think that the prblem in asia are going to cause major retrenchment at least in the semis and particularly in the semi equip. sector. One analysts states that over the last few years about $40 Billion/year of investment in semi infrastructure has occured creating a veru large state of over capacity (particularly in Korea and Taiwan). He predicts that over the next few quarters this rate will decrease to $15 Billion annualy. If he is only half right and the rate is $30 BB, you can see some major dislocations in that part of the market with, IMHO a major impact on the market in general. I think that until we see some downsizing and consolidation in that part of the high tech market, the bottom is probably still ahead rather than behind us. Zeev