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Politics : Formerly About Applied Materials -- Ignore unavailable to you. Want to Upgrade?

To: William Griffin who wrote (30711)	5/28/1999 12:12:00 PM
From: marc henschke	Respond to of 70976

A crystal ball?! Quite the opposite. The whole premise of the SSB analysis was proven to be dead wrong the day after their report came out. Indeed, SSB projected that AMAT's orders and earnings over the second half of this year would decline due to reduced spending from DRAM producers. But what we actually learned from AMAT's management the following day during the conference call was that earnings and orders will continue to sequentially rise, and that the company had seen no evidence of cut-backs from memory chip makers. Moreover, since that time we've actually seen public announcements from DRAM producers to the effect that they're going to bite the bullet and INCREASE capital spending this year. In short, the only thing that SSB's flawed analysis had going for it is was the fortuity of being released on the eve of a broad-based market correction due to inflation fears. When this correction ends and big money returns to the technology sector, the worthless nature of SSB's predictions will become readily apparent.

To: William Griffin who wrote (30711)	5/28/1999 12:16:00 PM
From: Sun Tzu	Read Replies (3) \| Respond to of 70976

>> What will drive the price to 70 from this juncture, other than perhaps earnings in August?? Speculation (or at least the expectation) that we are in the same old kind of business cycle that we've seen for the past 20 years. BTW, if I recall the SSB report correctly, one of their arguments was that this is not the same old business cycle and as such, a small down turn will be taken as the start of the next down cycle, thereby increasing the volatility. [Amazing, someone with willingness to risk his neck at SSB! This is a first and he must be new]. Jack: We are a long way away from the bottom, because supply has not fallen below demand yet. We slightly went below demand earlier in the year, but the excess capacity moved us above it again. This will continue until supply goes below demand and stays there for a while. That is when you know the bottom has been reached. ST