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Technology Stocks : Novell (NOVL) dirt cheap, good buy? -- Ignore unavailable to you. Want to Upgrade?

To: Frederick Smart who wrote (19235)	12/24/1997 8:46:00 AM
From: dwight vickers	Read Replies (1) \| Respond to of 42771

Frederick, (apologies for off topic,not much NOVL activity lately) I am, if anything, gloomier than Paul. Your point on the US inaction in 1929 is part of the reason. Japan today seems to be reacting the same way we did then. Julian Robertson commented in Barron's this week that they are acting "like deer, paralyzed by headlights". They have been impotent since day one, why should they suddenly act decisively? Until they realize that they need to cut taxes, reduce regulation, and open the money spigot, instead of strangling the flow, bad things can happen. Look at Korea for a situation where the authorities let things get out of hand without positive action. China is a potential trouble spot, also. Robertson also comments that China's economic strength (export boom) is being led by state run businesses that are not operating profitably, financed by Chinese banks that are all broke. So the US today is looking very strong. Beneath the surface we are also over regulated and over taxed, and not addressing our medicare and SS problems. Can we alone fuel a world economy that is in danger of imploding? We have countries devaluing their currencies and raising tariffs when they get in trouble. An underfunded IMF coming in to rescue them with demands that they raise taxes, and tighten money. And no growth virtually anywhere but here. How long can this last? We're swimming in consumer debt, and also geared up to be an export economy? In many ways the fundamentals are worse today than they were in '29. The debt and taxation situation is far worse, making the range of options narrower. Remember that all of this is happening when the world economies have been growing. What is hiding out there and will begin to show up if growth slows or recessions begin? Bottom line for me is that if anything we have worse political leadership in the world today than we have ever had. Can we really trust them to get it right? Dwight (Happy Holidays to everyone, in spite of my gloom!!!!!)

To: Frederick Smart who wrote (19235)	12/24/1997 11:50:00 AM
From: Paul Fiondella	Read Replies (1) \| Respond to of 42771

Bear Market Trap? and NOVL Well certainly what is happening to MSFT looks rigged to me. A non stop full speed slide without a bounce! However taking a look at NOVL. I think the market will punish this stock for this quarter's earnings. So I'm sorry to say, since I've gone through it myself, the NOVL longs are going to be punished too. ================== As to your remarks on the Asian crisis. First reliquifying the banks in JAPAN is not solved by printing money. As long as the bad loans are on the books printing money solves nothing. It simply allows the banks to avoid facing the music. The banks that are too far in have to be closed and their assets liquidated first. Then the government can pump liquidity in by using bonding mechanisms. Printing money is the quickest way to hell. It was tried by the Germans in the 1920's. As to your remarks about clanish business practices falling by the wayside and the triumph of capitalism. Clanish business practices like my spelling have not and are not likely to improve in Asia. There is some hope for Korea because they have elected a person who is not a member of the elite and therefore has nothing to lose by reforms. But reform at the stage that Korea is at is virtually worthless. It has to happen before the crisis. Japan has no "opposition" to the party of power---same goes for Russia, China, Singapore, and Indonesia. There are no reform forces in these countries capable of challenging the clanish business practices. As to the triumph of capitalism. You probably really mean that wonderful notion that markets are always right. Sure until they fail and we have to bail out the speculators with public money! As to capitalism, my position is that there never was a challenge to capitalism. Capitalism is an economic system which is a fact. It exists everywhere and has since it first took hold in the Venetian economy more than 1000 years ago because it represented an economic advance over feudalism and believe it or not the guild and royal systems of monopoly. If anything Asia is a crisis of the market---the world market. Something relatively new in the history of capitalism. It is also a crisis brought on by governments bailing out speculative investors and making them whole with public money. Capital chase profits. IF you make it so that specualtion is always rewarded then you have no self-regulating mechanism. The lack of ground rules in this area is what is wrecking the Asian economy. As one of my friends who went to Thailand said to me. I found high rise office buildings built on cheap land in slums. There were no water mains, no nearby public transportation, no occupants. Trading land in the desert from person to person at a higher and higher prices can only happen when there is a financial system dominated by speculation and out of control. Let them take their lumps in a debt rescheduling.