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To: Carl R. who wrote (41089)	11/27/1998 12:45:00 AM
From: Lee Lichterman III	Read Replies (1) \| Respond to of 53903

On the subject of why MU wasn't selling spot. I am no expert on DRAM but living up the street so to speak from MU I can tell you it wasn't from strength in contracts. When DRAM was strong, the factory ran 24 hours a day at max capacity and they couldn't hire people fast enough. For the last 9 months or so, shifts have been cut and the smoke stack count ( my informal drive by evaluation of production) was about 30-40%. Last week the smoke stacks were operating at a higher capacity but they still have not brought all the shifts back online and the parking lot is still only partially full at certain times of the day. My guess from these evaluations and talking with employees is they fired many workers and cut down production to drive up demand and are just now starting to increase production. They still are not producing at capacity which is good for keeping the price od DRAM from falling but still doesn't pay the rent on the unused space of the idle fabs. As Michael Burke says, when the X-mas lies are over, I will drive by one last time as I drive to the brokers office to load up on the puts that should make me smile by summer. Lee

To: Carl R. who wrote (41089)	11/27/1998 6:27:00 PM
From: yard_man	Respond to of 53903

So far PC sales have always been growing. It's the rate of change of growth in both units and sales that's important, right? There can be growth in unit sales and the PC makers could be in deep stuff, right? It's earnings and and continued growth in revenues. For instance, a stable unit growth with falling ASPs means shrinking revenues overall and probably shrinking margins as well. I think that contract sales are the reason as you and others suggested for MU not selling on the spot market. PC makers are anticipating a huge Christmas (don't they always). In addition as others have noted CPQ is starting a direct business. As someone else has said, they don't want to start with a whimper, so ...