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

To: Teri Skogerboe who wrote (20591)	6/19/1998 10:03:00 AM
From: Big Bucks	Read Replies (2) \| Respond to of 70976

Teri and all, FWIW biz.yahoo.com BB

To: Teri Skogerboe who wrote (20591)	6/19/1998 10:59:00 AM
From: Ramsey Su	Read Replies (2) \| Respond to of 70976

Teri, it is interesting how the same news regarding NVLS layoffs can be interpreted so differently. Here is my 2 cents. Staff reduction is great news when companies finally realize there are too much fat, such as the IBMs. On the other hand, when staff reduction are necessary because there is a lack of business, it is a disaster. There is a seldom use value indicator known as revenue per employee. In scenario one, staff reduction should result in an increase because revenue is constant while employee count decreases. In scenario two, revenue per employee may be same or lower because revenue is moving dn. This obviously directly result in drop in earnings and everything else because the non-labor related overhead are far more difficult to cut. These human resources maneuvers are extremely expensive, especially in the high tech arena. I think when companies like NVLS utilize this strategy, they are at the end of the ropes and certainly are not anticipating a near term turnaround. Changing subjects slightly, lets take a look at what is happening in Japan. First, I think there is going to be more lip service coming because they have an election coming up in July. Hashimoto gave an rally speech with more promises of better things to come (he should be a democrat here) but where is the beef? What is to prevent him from promising the moon just to reverse course a month from now? A strong China is not in Japan's best interest. A strong US and Chinese tie is not in Japan's best interest. Facing their own problem with their own money is not in Japan's best interest. If I am sitting across the table this weekend, representing the US team, I don't think I would feel very comfortable. They can tell me to go to hell and I am not sure what I can use as a come back. Bear in mind that Japan can single handedly DESTROY the US economy in a matter of hours just by announcing that they will sell all US debt instruments and take the money home. (not that it is likely to happen) Rubin rattled the US sabre this week, huffing and puffing. There is a sumarai sword on the other side that is still resting in its sheath. Finally, regardless of what the world wants Japan to do, they are indeed going to do something. What may be their priority? More important to this forum, the question is would Japan is spending money on new and improved fabs? My guess is no. Ramsey