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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: don ryndak who wrote (26326)	3/3/1998 3:45:00 PM
From: Knighty Tin	Read Replies (2) \| Respond to of 132070

Don, I don't think those orders have to do with the Lehi, Utah fab, as it has been mothballed for more than two years now. I think it has to do with the fact that MU planned to add capacity into this glut the way they did last year, and then somebody checked the bankbook and said, whoa. I am referring to the fact that MU claimed lack of test equipment prevents them from shipping as many chips as they would like, hence the buildup in inventory. It seems they come up with a new excuse every time inventories soar. In Y2K, there are the blue chip tertiary plays and the speculative direct plays. In the tertiary plays, Computer Associates and EDS seem to be a couple of firms reaping some benefits. In the direct plays, I like Keane as a company, but would like a sell-off before putting any money to work. I also like Intersolv at current levels. Less directly, I like the tech consulting and manpower firms, as this problem is primarily one of grunt programming work. Cambridge Partners and Judge are two that stick out IMHO. CATP more for the quality and Judge more for the speculation. On the bear side, Y2K is already impacting IT orders and that has to be bad for the chip industry, which is already in glut, the pc industry, where prices and channel stuffing are cutting the firms' legs off, and even for the software makers, whom I like longer term. IBM stands to lose the most, as I beleive Y2K will cause even a quicker than expected emmigration from mainframes to smaller boxes in a network. DRAM, SRAM, graphics chips, logic chips, and business boxes are going to be tougher sales while money is being spent fixing what companies already own. And, of course, the extra spending to run in place has to be bad news for those who have the most to spend, such as banks, mutual fund companies and brokers. To quote "Sell-Em-All" Smith, sell em all. Or, better yet, buy some puts in a 90/10 program, especially Leap puts. MB