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To: Steven Messina,L.M.T. who wrote (9705)	11/20/1997 6:12:00 PM
From: Andrew Vance	Read Replies (2) \| Respond to of 17305

AV--By the looks of your post, the Pacific Rim, Asian, Hang Seng, Korean, Taiwanese, Malayasian, or whatever you want to call the CRISIS over there, it seems that this turmoil is having a dramatic effect on the semiconductor industry (NOT). What the "boys" fail to realize it that this industry is the linch pin to their future survival. This industry wil drive their economies more than inflated real estate, financial shenanigans, etal. To stop progress (buying equipment and advancing technology) would to fatal, with almost no chance of being able to recuperate down the road. Everyone is already on the edge of their seats waiting for the IBM copper process to be proven and implemented. This may bring new types of equipment, new designs, new processes, etal. Technology always marches on and is the best definition for the word DYNAMIC INDUSTRY. Memory and Microprocessors are not the only thing constantly changing and advancing. That is why, in the long run, this sector will be volatile (due to some misunderstanding and lots of manipulation) but extremely profitable. You may be able to wear your clothes one more season, you might be able to put off buying that new car, you might even re-schedule a vacation or two. You can spend less on these previous examples and not go "first class" However, you will not fall behind on processing technology or buy less advanced equipment because the competition will bury you if you do. Sure, you may be able to extend a process for awhile (like the DUV scenario) but, in the end, you have to implement it more vigorously when you do. Fits and starts, fits and starts. No other sector has such a fast path of obsolescence. As a matter of fact we are now in what has been dubbed by some as "forklift technology". That is, with 300mm, new processes (Cu, cleaning, CMP, etc.), and smaller design rules (0.25u threshold) all coming into play within the same time horizon (1-3 yrs), you will be seeing more forklifts being used to remove outmoded equipment and replace it with more advanced equipment. What has never been mentioned before in terms of equipment is the equipment life cycle. It used to be that equipment was depreciated over the course of 5-7 years. You are now seeing equipment depreciated on faster timeframes like 3 years because of the accelerated rate of obsolescence of the equipment. No one that I am aware of has linked Moore's Law to the equipment arena. Every new process technology is taking shorter time to implement and has a shorter life cycle while each new generation gets geometrically more complicated. Well, with have finally hit the equipment threshold. YES, I am still a Bull in the BEAR tech sector market. Eventually, the "all unknowing, all uninformed, all manipulative" herd members will jump on the band wagon again and run these puppies up. As usual, my timing might be slightly off but the buying on the way down helps compensate for the early to market approach. When it does come back, I have a helluva lot of profit to worry about. QUESTION OF THE DAY. - Is AMAT going to respond positively tomorrow or is it going to be a case of Mystery vs. History? Will there be some good follow through on the rest of the equipment stocks?? Inquiring minds want to know. BTW-when you read the financials on AMAT, there is a section on settling litigation with GSX (General Signal) over "cluster tools" based on some Drytek, Inc. prior capabilities. I bet you didn't know that my hero, Art Z of Ultratech had a previous life. He was MR. DRYTEK prior to selling his company to GSX. He made his first fortunes at DRYTEK and then became a ranking person at GSX before taking over the UTEK subsidiary at GSX. He engineered the buyout of UTEK from GSX and the rest is history. GSX is still fuming at the chump change Art paid for UTEK and the success he made it. However, while I am unsure of the numbers related to the sale of Drytek to GSX, I am sure it was for less than the litigation settlement AMAT paid GSX. So I guess it all evens out in the end.<GGG> Oh yeah, I forgot to mention that Ary and I had discussions numerous years ago relative to processing many levels within a single chamber or connected chambers. This took place more than a decade ago. P-GILD is a realization of some of those discussions and pie-in-the sky ideas of Art's. I'll bet he doesn't remember those discussions but I do. IF he thinks it, he can do it. That is why I am very bullish on his company. He is a winner. Even in the poor market performance over the past few weeks, UTEK never got really eviscerated. (32-25 but the 32 was an anomalous momentary high) Andrew