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Technology Stocks : WDC/Sandisk Corporation -- Ignore unavailable to you. Want to Upgrade?

To: SiliconAlley who wrote (59879)	2/16/2016 1:14:26 PM
From: Art Bechhoefer	Read Replies (1) \| Respond to of 60323

My view on the prospects for SNDK at $86.50 is based on two key issues: 1. Chinese interests want the technology of both companies, and especially SNDK, as there is no way they can get the technology for non–volatile flash memory as cheap as it costs buying SNDK through WDC. 2. The prices of most tech stocks are depressed in part because the low prices for crude oil have dragged down almost all stock prices. Acquiring SNDK on the open market at present prices is akin to arbitrage, based on the premise that the stock price is artificially low. The Chinese could actually be buying SNDK directly at current prices, thereby lowering their overall cost of buying stock in WDC. If you think this is weird thinking, just remember that China's foreign exchange reserves lately have been declining rapidly. It's not necessarily do to attempts to trade renminbi for dollars or other hard currencies, because there still are restrictions that prevent wholesale trading of Chinese currency on the foreign exchange market. More likely, the Chinese are continuing to use their dollar surplus to buy dollar denominated assets. Art