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Technology Stocks : Qualcomm Incorporated (QCOM) -- Ignore unavailable to you. Want to Upgrade?

To: Gregg Powers who wrote (11412)	6/11/1998 8:00:00 PM
From: Ramsey Su	Read Replies (1) \| Respond to of 152472

Gregg, I was just about to post a question to you and you beat me to the punch by answering parts of it. The question being how much research and weight do you put on overall market conditions vs specific stocks. During the brief 4-5 years that I have been active, I find the overall market to be the single most important factor. In other words, it is very easy to dart board a winner during the last couple of years while it will take a genius to make money during the down years. Looking ahead, I have never been more pessimistic, regardless of how sound I think QC is as a company. For the first time, I cannot rule out potential catastrophic events of such magnitude that makes Black Monday of 1987 a minor set back. This Asian crisis is still a tunnel with no end. I expect Y2K will start showing its true colors before the end of this year. I may be labeled chicken little but I think it is prudent to have some type of a game plan. What type of strategies do you or your firm deploy in situations such as these? Ramsey

To: Gregg Powers who wrote (11412)	6/12/1998 12:30:00 AM
From: Jon Koplik	Respond to of 152472

Gregg - I think it was actually Smoot Hawley. Jon

To: Gregg Powers who wrote (11412)	6/12/1998 5:23:00 AM
From: Maurice Winn	Read Replies (2) \| Respond to of 152472

Thanks for enlarging on the small piece of information the NZ Herald gave me on Alan Greenspan. I didn't know they used the tulip analogy - it obviously fits the situation. Though Greenspan thought that an exaggeration from your comment. I don't see Asian woes as anything good for the USA economy. The "woes keeping USA interest rates down and therefore good for the economy" sounds like twaddle to me. Production is good. There is only production. If production drops. That's bad. If people go bust that's worse. If they have trade wars that's even worse. If they fight that's worst of all. The common concept that Asia and USA are unlinked is silly. Ramsey and I discussed this 7 months ago and I opined that the USA would wake only slowly to the shambles, then panic when they realized they are in it too. Ramsey thought then what most are thinking now and what he is still saying now. I stick with my original thesis that it will be a cruncher down, but the yen, dollar etc will be elastic-banded in a raid on cash holders and taxpayers, which will finance Japan taking over and recapitalizing banks as they go bust. The Fed will finance the likes of Qualcomm, who will go shopping for super cheap Korean and other assets. People will move their money around, swap a few jobs, buy more cmdaOne phones, cancel trips overseas and my dividends will barely be dented. 2 years ago, jfred was worrying about deflation and just this situation. He reckoned that states wouldn't be able to print and lend fast enough in a high speed deflation. I reckoned they could. It looks as though it took a couple of years but the test is on us. Who's right? Ramsey, jfred or Maurice? I'll find out soon. I don't accept that deflation automatically damages corporate earnings. There has been huge computer deflation in the context of improved hardware design and manufacturing. That's good and a driving force for the new paradigm. With big corporate profits attached. You are talking more of currency deflation overall, but even here, it is symptomatic of economic duress, so production and profits are down as a consequence of that - rather than the deflation. As I see it anyway. A hot shot company like Qualcomm will still do fine. Especially where they operate in a situation where markets can clear quickly. I"m not a 1929 expert, but it is obvious that if you put up trade barriers, production will fall. The interest rates are somewhat irrelevant. As you say, why borrow gold, which is what money largely was then, if you don't have something useful to pay people to do. Now, Japan. How much did the population drop last year? And what did the average age do? Those two factors aren't talked about much. Also, Japanese are quite well off [financially anyway], so why work too hard? Check out the younger generation's work ethic. My student exchange Japanese son has a different attitude from his father. As do many of them. They don't hope to die as a Salaryman on the Yamanote Line on the way home from the office at midnight. Of course production will drop - which is not to deny the mess the banks and debtors have got themselves in which is making it all worse. I don't see that the Bank of Japan can be "out of bullets". Money is infinitely elastic. They just write another cheque. Hey presto, more bullets and another bank taken over and debts cleared. They hold a lot of USA dollars too - so they can go shopping with those. The point you make that Japan can't mimic the S&L bailout as interest rates are near zero and nobody will borrow, even at 1%, to take over a zero value thing, which will involve many costs, is fair enough. But the government can do so - which again is a hidden tax. They print themselves a few trillion. Pay off the bank creditors in exchange for the shares of the bank at a price of 0 yen per share. Bad luck for shareholders! Bad luck for taxpayers and yen holders. But the financial system at least won't collapse. But getting to the point of your post - I agree, the details lead to the same conclusion = internationally disrupted and reduced trade flows, unemployment, market clearing costs, a general mess. Including the USA. The thing which I never did figure out is this one - is debt soft on the outside and hard in the centre or more like a mallowpuff, firm on the outside but fluff in the centre? That is, does debt implode as debts worldwide get called in - marginmike, marginmaurice, deepmargin, credit cards, etc etc, Donaldson Lufkin Jenrette Securities, overdrafts? Or do Ramsey, Chris Reeder, $ill Gates and the prudent ones have enough money to buy everything before collapse occurs? Can debt simply collapse like a black hole? Better go before I lose all this!! Sorry it's so long. Mqurice