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Technology Stocks : Semi-Equips - Buy when BLOOD is running in the streets! -- Ignore unavailable to you. Want to Upgrade?

To: John Metcalf who wrote (7324)	12/3/1998 1:24:00 AM
From: JBonline	Respond to of 10921

RE: "In Oct 97, the Asian debacle became clear " Sorry I did not respond earlier. A funeral up north, followed by my carrying a nasty stomach virus back to Texas, left me frantically trying to catch up at work. Actually, the Asian debacle was clear MUCH earlier than Oct. 97. The brokers financing margin accounts weren't scared enough until that Oct. Remember Christopher Wood's prescient book (early 90's??) "The Bubble Economy"?? Woods' qualifications included being an editor for "The Economist", which has done a tremendous job of keeping those interested in such topics posted. The subsequent Sumitomo copper scandal and the Nomura securites fiasco both helped drive home the lessons in Woods' book. That the Asian problems would affect the semiconductor equip companies started showing up in early '97. Lam Research made it clear in its fiscal reports there were going to be problems-- Lam and Novellus and AMAT, if I remember correctly, were screwed substantially by SubMicron not being able to pay-up (it's been so looong ago-- I think it was SubMicron). Late that summer (July? August?), the drama of it all deepened. The London Financial Times had a BIG article. Latin American banker-types were sufficently scared of contagion to pull tons of money out of THEIR stock markets and send it abroad, starting a currency stampede that has more recently culminated in the $75 billion or so in Brazilian foreign reserves being cut in half. Over these months, the volatility in stock prices for companies like LRCX andf CYMI posed tremendous money-making (and money-losing) opportunities for people with the luxury of watching (and acting) on stock market fluctuations on a within-day basis. THEN the U.S. broker-types FINALLY got scared enough to start pulling plugs on margin accounts and doing massive downgrades. As plugs were pulled, margin account-holders sold off good stocks, not just bad, to cut their losses. The same pattern may be about to recur with the frothy, fluffy, "there ain't much book value or earnings there" internet companies that have been rocketing away. Whoa, boy! Down, horsie! It's so much more exciting than those spicey soap operas some of our pals used to watch back in college, don't you think? At least the semiequips are blessed with fundamental value, not just momentum and high hopes. Best wishes, Julia.