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Strategies & Market Trends : Asia Forum -- Ignore unavailable to you. Want to Upgrade?

To: Thomas Haegin who wrote (4343)	6/10/1998 2:18:00 PM
From: MikeM54321	Read Replies (2) \| Respond to of 9980

Thomas, Isn't this a turnaround. That post I did concerning Cramer's comments puzzled me. But what also got to me, very slightly, was his knock on the Asia Worry Worts. That was part of the reason I posted a part of his piece. Well now look at what he posts today. I do have to hand it to Cramer. He is quick on his opinions, and quick to admit he's wrong. Well, at least for today, Cramer may believe the Asia worriers aren't so wrong after all. MikeM(From Florida) ****************************** Wrong! Tactics and Strategies: Beware the Chip-Equipment Stocks By James J. Cramer 6/10/98 No sooner did I highlight that maybe it was time to take a look at the semiconductor-equipment and disk-drive stocks than Lattice, Western Digital and Read-Rite blow up. Nothing like a convenient reminder to validate my partner Jeff Berkowitz' vision to stay away from these nasty boys. Why are these two groups eluding any sort of bottom? Frankly, these two sectors turned out to be more leveraged than any other to East Asian problems,. In different ways. For the semiconductor-equipment companies, the Koreans, Taiwanese and Japanese remained the largest source of clients despite the resurgence of American manufacturing. The numbers you are seeing now, including the pre-announcements, reflect the distinct lack of turnaround in this sector. In fact, it represents a deterioration. Many of you, I know, are salivating to buy these stocks, especially the quality choice among them, Applied Materials. I know I am, too. Under $30 I am drawn to it like a magnet. But I defer to my sleuthing partner, Jeff, who has adopted a wait-and-still-don't-see attitude that has saved our firm mucho dollars. No bottom yet, is the only thing he will keep saying. So far I have been wrong; he's been right. Let's go with him. The drive problems have less to do with customers and more to do with competition from East Asia**. Disk drives aren't that hard to make, and the assembly of them has always been done well in East Asia. The reliquification of Maxtor -- chronicled outstandingly by Adam Lashinsky in the San Jose Mercury until a little glitch about dilution in terms of the underwriting filed by these guys -- is just more bad news. To get a true bottom in drives that is sustainable, we need someone to go out of business, not get more capital to stay in business...