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Technology Stocks : Cisco Systems, Inc. (CSCO) -- Ignore unavailable to you. Want to Upgrade?

To: Rob Rob who wrote (20379)	1/6/1999 10:41:00 AM
From: Zoltan!	Read Replies (1) \| Respond to of 77400

DowJones shows 101 1/16 as the day high. So far.

To: Rob Rob who wrote (20379)	1/6/1999 10:45:00 AM
From: Zoltan!	Respond to of 77400

Of concern to Cisco SH and all internet investors: When you tax something, you get less of it--and when you tax something less, you get more of it. January 6, 1999 Why the Internet Had a Merry Christmas By Lawrence Kudlow, chief economist at American Skandia Life Assurance Corp. and author of "American Abundance: The New Economic and Moral Prosperity" (Forbes, 1998). What accounts for unexpectedly strong online Christmas-season sales and soaring Internet and technology stocks? Careful market charting suggests the answer is a supply-side tax bill. Tax freedom, which unlocks the door to growth, has created a flood of new shoppers, retailers and investors in cyberspace. Conventional wisdom points to the Federal Reserve's Oct. 15 interest-rate cuts as the driving force behind this autumn's stock market rally. But market indexes actually bottomed out on Oct. 8, the same day the Senate passed the Internet Tax Freedom Act, which mandates a three-year tax moratorium on Internet sales. Passage of that bill galvanized a surge of holiday purchases among Internet users: Sales revenues for 1998 are expected to reach $13 billion, compared with earlier estimates of $6 billion to $8 billion. It also unleashed an unprecedented rally in technology stocks, which then spilled over into more traditional stock indexes. Thus, since Oct. 8 the "old economy" Dow Jones Industrial Average has increased 24%, while the broader Standard & Poor's 500 has jumped 33%. Pretty impressive. But in new-paradigm tech-land the Nasdaq has grown by a staggering 58%, and TheStreet.com's Internet Index has leapt an extracelestial 200%. Supply-siders have long argued that economic incentives, especially after-tax returns, influence individual and business behavior. It must pay to produce, purchase, take risks and invest. When you tax something, you get less of it--and when you tax something less, you get more of it. This is why sales taxes matter as much as income taxes. When New York Mayor Rudolph Giuliani declared a sales-tax holiday, sales volume soared. By contrast, it was the threat of a transactions tax that helped trigger the October 1987 stock market crash. This logic suggests the harm that a sales tax would inflict on Internet commerce. Electronic commerce is a business that depends on volume in an environment where profit margins are razor thin. Imposing an Internet sales tax would create a tax wedge that both raises producer costs and dries up consumer volume. For the time being, however, e-commerce is more than fulfilling its promise. It is attracting new customers who will increase overall retail sales. Quick, convenient and hassle-free Internet shopping (with no transportation costs) appeals to the growing elderly population, as well as to busy executives, stay-at-home moms, bargain hunters, the sick, the handicapped and others. More impressive yet is electronic commerce's growth potential. Today, less than 25% of Americans regularly use the Internet, and far fewer are comfortable shopping on it. According to Jupiter Communications LLC, only 10% of the 500,000 U.S. Internet sites actually sell products. What's more, only about 45% of the U.S. population now owns a personal computer, so there's plenty of room for expansion. Think of the mass-consumerization of telephones and automobiles in the 1920s, or the explosive purchases of washing machines and television sets following World War II. In both periods, new technologies spurred long-term prosperity--and stock market surges. To be sure, triple-digit price-earnings multiples for Internet stocks may be scaring off some analysts and investors; surely these shares will be subject to normal market corrections and industry consolidations. But the forward-looking stock market is already taking into account the likelihood of an explosion of online revenues during the next few years, assuming that cybersales remain duty free. A greater worry is the numerous state governments that are scheming for a tax grab on Internet-related revenues. Congress should hold the line by making the tax moratorium permanent. State-tax revenues are already growing at more than three times the inflation rate. And Internet vendors, whose income and sales are already taxed where they are physically headquartered, should not be triple-taxed in cyberspace. The sudden rise of electronic commerce showcases once again the unpredictable spillover benefits of information technologies. The same holds true for tax incentives; monetary policy is not the only game in town. Tax freedom leads to cheaper products, easier access, stronger growth and happier consumers. Washington should take great care not to impose tax or regulatory obstacles (including trustbusting jihads) that would cripple the technological revolution that has become the backbone of our dynamic new economy. interactive.wsj.com The states have to stopped before they tax something they have no Constitutional authority to tax (in most cases).

To: Rob Rob who wrote (20379)	1/6/1999 12:44:00 PM
From: Eric	Read Replies (2) \| Respond to of 77400

No big spike. Cisco now at 101 1/8 up 4 1/8 for the day, real time quote from my on line broker. High of 101 3/4 and a low of 99. A very nice gap up, very bullish short term for the stock! Of course the rest of the market isn't doing to bad either! <ggg> Eric