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

To: Paul V. who wrote (3857)	12/16/1997 8:50:00 AM
From: Jay M. Harris	Read Replies (1) \| Respond to of 10921

Don't you remember that memory prices rebounded 50% before the big boys took you to new highs? Don't you remember what took AMAT to $17 pre split? I think it was rapidly declining memory prices. Guess what? Memory prices have declined -11% in Oct 97; -14% in Nov 97 and -28% in December 97 with no sign of letting up! They are currently declining faster than they did in 1996! Wall Street is currently modeling flat equipment growth in 1998. This is too high. Fabs MUST reduce production to survive! They are currently losing big bucks. Regards, Jay

To: Paul V. who wrote (3857)	12/16/1997 12:24:00 PM
From: Teri Skogerboe	Read Replies (3) \| Respond to of 10921

Paul and GM, Re: "We all know that AMAT is an excellent price and trying to time it is very difficult." I couldn't agree more that timing is very difficult, but I tend to disagree that AMAT is an excellent price at today's levels, if compared to historical price levels, AMAT is not a bargain. Re: "...post-split price at $10.9375-$18.00. If my recall is correct it was the mutual funds and big boys who were late then when they got into the stock taking us along to new heights as AMAT gained new heights. Don't we see the same happening again? What do you think?" If the same thing were to happen again, we'd re-visit $10.9375 - $18.00, and the number of Mutual Funds owning AMAT would probably plunge from the current 389 (from today's IBD). Then after alot of weeping and bloodshed, the Mutual Funds would come back cautiously at first, then pile in. From looking at the 389 figure, I'd say we're more towards the "pile in" phase than the "blood in the streets" phase. I should confess that I did raise some cash, but I haven't yet sold short any equipment stock. I am still holding EGLS and SVGI plus several non-equip stocks. I would love to hear a convincing bullish case as it relates to DRAMs, meaning why will the memory makers upgrade equipment in an environment where they cannot make money? I can't make any sense of the rally the past couple of days. IMHO, it's probably a sucker rally, because nothing has changed in the last two days. It seems to me that we need applications for 64Mg in order to drive that market forward, and we need demand growth for chips, because we have too darn much capacity. It almost seems to me that we didn't really have the down-cycle this time. We went down and then the countries/companies who shouldn't have spent money to stay in the game spent lots of money, thereby creating an even more over-capacitied situation. (This doesn't sound good to me.) Regards, Teri PS. I am fully open to other view-points and in fact, would love to be convinced that it's safe to go back in the semi-equip waters heavily.

To: Paul V. who wrote (3857)	12/16/1997 9:06:00 PM
From: Paul V.	Respond to of 10921

Teri and Threaders, If you my post to the amat site see following post. Tito, Isn't ironic that we are have downgrades by brokerage houses while the number of funds holding AMAT has increase from approx. 363 a month ago to 377 last Tuesday to 389 in todays IBD, 12/16/97. The 389 number today is greater than the number of funds owning AMAT shares in the big $108 run up in August '96 by approx. 12 funds. IMHO, it appears to me that the funds are not making the same mistake they did in the last down cycle in 1996 when the small investor got ahead of them. Could there be a relationship between downgrades and increased number of mutual funds? Of course not!:) Could there be purchases made by mutual funds at the same time that they are downgrading AMAT? Of course not!:) Just my two cents. Paul V.