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To: Zeev Hed who wrote (39471)	9/30/1998 10:37:00 PM
From: Skeeter Bug	Read Replies (2) \| Respond to of 53903

zeev, i think you misunderstood. if i spend $2 billion on a fab last q, it is not proper to say that the fab doesn't cost anything this q. the opportunity cost of the fab is the return you would have earned if you did not buy the fab. at 5%, that is $25 million in foregone interest to buy the fab. it is improper, no matter how you slice it, to argue that depreciation is somr kind of costless asset. anyway, does mu have more free cash this q than last q? i guess the simplest of ways to figure this out is develop some kind of net cash burn rate. the funny thing, though, is everyone is excited about new money coming in as though it is free. it isn't. not only does interest need to be paid but so does the principle. if somebody showed me this balance sheet and said this is the result if 4-5 years of rosy scenario and 3 qs of losses i would shudder. less fear is much more appropriate, imho. that $1 billion in depreciation can't be spent to upgrade fabs as was stated originally. i just want to be clear so some aren't confused and think it is money to be spent.