Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Patrick E.McDaniel who wrote (69165)	10/5/1998 9:29:00 AM
From: D. Swiss	Read Replies (2) \| Respond to of 176387

Pat babes, this guy is a zero besides being a lying sack of s*it. He always manages to sell at the high, by at the low and be in cash at the same time. :o) Drew

To: Patrick E.McDaniel who wrote (69165)	10/5/1998 9:30:00 AM
From: D. Swiss	Read Replies (1) \| Respond to of 176387

I don't know if this was posted yet. investor.msn.com :o) DRew

To: Patrick E.McDaniel who wrote (69165)	10/5/1998 9:54:00 AM
From: Mohan Marette	Read Replies (1) \| Respond to of 176387

The Jubak-missive:4 stocks that could thrive amid deflation-say DELL. Good morning Pat: Here is an excerpt from Jubak's Journal from Microsoft Investor. Posted 10/2/98 See "Deflation: Why It's Coming, whether It's Good or Bad, and how It Will Affect Your Investments, Your Business, and Your Personal Affairs" by A. Gary Shilling at Barnes and Noble. Jubak's Journal 4 stocks likely to thrive amid deflation Not everyone will be hurt by the coming global shift to a deflationary economy. I've picked some key names likely to prosper. By Jim Jubak What companies -- and what stocks -- will thrive despite deflation? In my last column, after I'd laid out my belief that major parts of the domestic and global economy are facing an extended period of falling prices ("Is deflation now the real worry?"), I promised to tackle that question. There are a lot of ways to go about the job. You could, for example, take apart the causes of our current deflation and then look for companies that should benefit from those trends. (Economist A. Gary Shilling does a good job of running through the causes in his recent book, "Deflation: Why It's Coming, Whether It's Good or Bad, and How It Will Affect Your Investments, Your Business, and Your Personal Affairs," from Lakeview Publishing. For more information see the sponsored link in the left sidebar below.) But I prefer starting with companies and working backward to the trends. A global economy doesn't go from inflation to deflation overnight, and the transition doesn't occur across all industries at once. Some industries have been living with deflation for years. The companies that have thrived in those "early deflator" industries can help investors understand what strategies, assets and corporate structures will be most valuable as deflation spreads to other parts of the global economy. At the end of my last column, I mentioned four companies -- Dell Computer (DELL), Wal-Mart (WMT), Charles Schwab (SCH), and General Electric (GE) -- which I think will likely be winners in deflationary industries. I tagged them because they've already done such a great job of coping with deflation. An investor worried about deflation could just invest in these four -- though, since they've been so successful, their stocks aren't exactly cheap. Or you could analyze what has made these four companies so successful at coping with deflation and then look for relatively undiscovered companies with similar products, strategies and cultures. I'm going to take this second route. First, I'll tell you what I think makes each of those four companies a model worth emulating in a deflationary environment and then I'll suggest a company or two that seems to share that trait. (As always, second-guessing is thoroughly encouraged. Just go to the "Discuss it" link at the end of this story to add your quibbles and caveats.) Let's start with Dell In a deflationary world, inventory costs you money. A company wants to buy its raw materials at the last minute and deliver its finished products to customers with as little delay as possible. Let's take two companies, both selling personal computers. One buys a disk drive for $100 and keeps it in inventory for two months before it goes into a computer. Because disk-drive prices are falling, the second box maker, Dell, buys the disk drive for $90 just five days before the computer is assembled. The first company ships its assembled computer to a dealer where it sits on a shelf for a month before being sold. In that time, the selling price drops from $950 to $800. Dell, on the other hand, takes an order and ships the assembled machine in just a week and collects the full $950 price. Dell has saved $10 in manufacturing cost and received an extra $150 from the consumer. Details How do you get profit-devouring inventory off your books? Part of the answer is in distribution. Dell sells directly to consumers and businesses, eliminating the system of dealers, resellers, and consultants -- and their inventory -- used by IBM (IBM)Compaq (CPQ), and Hewlett-Packard (HWP). But you have to also look at how Dell differs from the traditional manufacturer. Dell doesn't make disk drives or chips or monitors. It doesn't buy the components for motherboards or keyboards and build them itself. Actually, it would be more accurate to call Dell an assembler than a manufacturer. Dell buys subsystems -- designed so they can be mixed and matched to produce the different models that customers order -- and then puts those together. It takes Dell so little time to make a computer because someone else has done much of the manufacturing. That's a trend that's not limited to the computer industry, and deflation will make this kind of modular manufacturing even more crucial..... To see the article go to: investor.msn.com