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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: jtechkid who wrote (18963)	4/22/1998 11:25:00 PM
From: Shortnlong	Read Replies (1) \| Respond to of 70976

Somewhat OT ** Re: The market My aunt called me today and told me to invest a sizable chunk of her retirement savings in the stock market. This is a woman who does not speak English, and would rather keep cash at home than trust a bank, and now she is convinced that investing in the stock market is the way to go. I told her she could lose money in the market, and may be she should be conservative being so close to retirement, and she said there was no way she could lose. Well, I disappointed my aunt by refusing to take her money... (may be I should put it in AMAT huh ? :) Sigh.....

To: jtechkid who wrote (18963)	4/23/1998 9:56:00 AM
From: Ian@SI	Read Replies (2) \| Respond to of 70976

Time to go long... Taiwan Shooting to Become World-class Semiconductor Manufacturing Center April 23, 1998 Source: Comline Electronics Wire Comline Electronics Wire via NewsEdge Corporation -- Taiwanese companies are girding to expand their share of the world semiconductor industry from the present 3.4% to 8%. Companies are extremely specialized now; 81 are engaged in IC design; 20, in IC manufacture; 23, in IC packaging; and 16 in IC testing. The foundries belonging to foreign producers (Toshiba, Fujitsu, Mitsubishi, TI, Motorola, Siemens) are a dominating force in the Taiwanese market, as the makers pursue cordial relations with local producers. Taiwan's producers made US$10 billion of sales last year. This broke down to $5.3 billion for IC manufacture; $3.2 billion for packaging; and $1.1 billion for design. Plans call for sales to be increased to $17.8 billion by the year 2000, of which fab would be $10.7 billion, double the figure for 1997. IC manufacturers are planning NT$500 billion in investments to build 24 wafer plants through 2000. Their goal is a total of 24 or 25 lines for producing 12-inch wafers and four new lines for producing 8-inch wafers.

To: jtechkid who wrote (18963)	4/23/1998 9:57:00 AM
From: akidron	Respond to of 70976

Jtechkid IMHO today is when u should being to short AMAT et al as u r right, it is a scam in the sense that stock prices are expaning at rates that make a mockery of expected earnings growth... there is outstanding post from the ABX thread I wanted to share with u all... To: Ross (598 ) From: ahhaha Wednesday, Apr 22 1998 11:38PM ET Reply # of 603 As an old pro I assure you that gold and precious metals, commodities, etc. are trading vehicles. They aren't investments. Even an investment is taken with the intent of eventually selling it.The trading vehicles don't create added value because they don't harness what humans can do. This is the only true thing of value. There is no intrinsic value in material goods. They don't create future wealth. Neither does real estate. It's a cold loss. However these material assets can have extended bull markets for only one reason: psychology. The psychology of rational expectations, or the psychology of lack of trust. Or excess wealth. Or fear of deprivation. Or the greater fool. That is the core reason for inflation. A state of mind. That's why the profs at Harvard, MIT, Berkeley and just about everyone else can't quite figure it out. There is no inflation right now according to the government measures. Tells you nothing. The people are hardening their hearts towards the creators of wealth. They want theirs. They have been trained to expect the guaranteed existence. If they don't get it, they'll pull down the entire world. We've had an extended run in the good and easy life. The situation isn't as ripe as it was in the late '60's, but there are enough pieces in place to get the ball rolling at least up to the major down trend. The major down trend is the reality that goods almost cost nothing to produce. The essence of value is the ability to do something with skill. Those that can do will start demanding more for it because they can get away with it. Their situation is inelastic because the intervening years has made many indolent and dependent. I call this expertism and it has been well-analyzed by Fredrich Von Hayek. To the extent that the few have the many at a disadvantage, to that extent they can inflate their worth. The recognition of this superiority reflates up to the down trend. Central banks can't do anything. In fact, just about anything they do feeds fuel into the fire. This state of affairs is called "pushing on a string", and is the reverse of what is usually an environment where this characterization applies. What it usually means is the central bank's creation of money doesn't bail the depressed economy out because people are too afraid to borrow. A liquidity trap. In this case raising interest rates hurts the mass of incompetents more than it hurts the skilled elite who will continue to demand wages in excess of the rate the less skilled are worth. The less skilled can still push through protective wage demands that are in excess of the worth of the output. The result is structural inflation. Actually, we should call it "pulling on a rubber". That which is pushed or pulled will go whatever way it wants regardless of pushing or pulling. Why didn't this scenario develop in the late '80's? Because the rest of the world was still coming out of socialism, out of the Stone Age, and were willing to work harder for less. The world's wealth moves in the direction of that combination. The world's wealth moves to MSFT because they give their stuff away. During the '90s the rest of the world has been under the whip of the running dog capitalists. Since semi-skilled labor didn't want to own the means of production, didn't want the risk and responsibility of having to make it happen, just wanted the guaranteed existence, they have had to suffer the consequences of exploitation without adequate compensation. They have learned though that they don't need to work for a song. The result has been worldwide parity in intrinsic value of labor in most semi-skilled positions. There's few places left to get cheap labor. When a few raise their wage rate, the rest of the world will follow gleefully. Also during the '80s the entire US had got a fix with COLA. Since draconian interest rates of the past made inflationary wage settlements impossible, legislatures have easily pushed through laws protecting and indexing everything to inflation. The outcome is that at the slightest hint of inflation, the FED, e.g., has to go in and engage in massive tightening to avoid an explosion of prices. They won't do it because they're hoping Asian problems will bail us out. They'll delay. That's where you get the gold trade. Eventually they have to blast us all, and you have to sell the gold play. It is also true that gold does well in pure deflation as in the '30s. But after the blasting that's about what we'll be in so maybe you shouldn't sell the gold!