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To: dumbmoney who wrote (33383)	5/15/1998 6:20:00 AM
From: Skeeter Bug	Respond to of 53903

d-money, of course, you are right. mu can and will continue to liquidate assets. this will tide them over for some time. however, if they are losing $500 million in cash from ops losses and capexes (which they need to stay in the game and prevent futher accelerating ops losses) then those assets will be eaten up rather quickly. 4 months from now and mu may have little cash above short term debt. an additional 2 qs after this 4 months and mu has to sell ALL of its muei and still doesn't have enough cash once short term debt is taken out. and no muei is left to sell. what well will they go to then? just over three qs out you may see and muei;ess mu with zero cash and massive ongoing losses. they've already raided muei and made it one of the worst pc performers. they can't continue to raid it at such a high rate. so i expect losses to mount going forward, all else being equal (and it is worse!)

To: dumbmoney who wrote (33383)	5/15/1998 9:29:00 AM
From: mike iles	Respond to of 53903

dumbmoney, If MU can't find the money to compete in 256, then they will go out of business. This is a no-limits poker game and you have to play every hand. That's why you have to laugh when management says they don't like what's going on and they're goin' to take their chips (what's left of them) off the table. BTW their balance sheet isn't nearly as strong as the bulls would have you believe. If you net out debt and take out what belongs to MUEI, they were in the hole to the tune of $223 million last quarter. They burned up $182 million in the semi business that quarter. This came from operating losses, capital spending (maintenance level) and money spent building up inventories and accounts receivable. You may well ask how come working capital requirements are higher when sales are dropping like a rock ... strangely enough management didn't address this issue on the confercall. What happens this quarter? My guess is significantly higher op. losses, continued minimal capital spending, and a reduction in inventories and ARs. Net, they burn up another $200M cash. Starts to look ugly ... if DRAM market doesn't improve they're in a spiral to oblivion. regards, Mike