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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: John Dally who wrote (3595)	11/27/1997 4:46:00 PM
From: Ian@SI	Read Replies (2) \| Respond to of 10921

John, I think you've spent too much time reading the "Ask Michael Burke" thread. I haven't had that "pleasure" in the last couple years. ;-) Is he still twisting every isolated piece of data into a bearish omen? First, I agree that the chipmakers will have a hard time raising or maintaining prices. That is nothing new for them. Since their first chip, they've had to sustain abnormally large productivity improvements just to barely survive. Second, guess where those productivity improvements come from. In case you're a little slow, I'll give you a hint. :-) The Semiconductor Equipment Makers. When the chipmaker can buy a single tool that will improve productivity of the millions of chips monthly that will be produced, guess what the chipmaker does. He buys it. Whether it costs $50,000 or $7.5M. The other choice is to exit the business. And the least efficient chipmakers do that continuously. which means that the most efficient chipmakers buy more equipment. Third, your numbers are out of date and not indicative of current or probable future growth. It appears that the numbers have caused you to form ideas, beliefs and conclusions which are likely to be proven erroneous fairly quickly. Yes, $ sales fell from 1995 to 1996. That did not happen in 97. Nor is it forecast to happen in 98, 99 or 2000. In any case, unit volume has increased significantly every year even from 95 to 96. Equipment sales are more closely related to unit sales than $. In any case, I believe that I now understand what is causing you to hold the beliefs that you do. I seldom offer others advice (as opposed to sharing what I would do). In your case, it may be worthwhile to invest no more than you're willing to lose. Ian.