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Slumbering Tech Stocks

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Category: 2002 Published on Wednesday, 18 March 2009
Mike Berman
Dave Berman

Ah, poor Dave! His frizzy head in the clouds and his feet firmly planted in quicksand!

Ever hear the word "shakeout"???? That's when a bunch of companies that really didn't deserve to exist get their comeupance and fail, causing investors to lose confidence in that segment of the market. This is exactly what's happened to tech stocks.

Many of the dotcoms and software companies that were created to take advantage of the tech boom in the mid 80s and early 90s are going bye-bye, leaving investors with worthless pieces of paper and, unfortunately creating a backlash that is hurting bigger, more reliable tech companies.

Also, money grubbing investors that worship the gods of buy low and sell high will continue to keep stock prices in the crapper as they move to grab quick profits when the market begins to recover, sending it spiraling down again.

Obviously you'd think that, with most of the underfunded dotcoms, etc. gone, we'd see a recovery, but that really won't happen until there's a massive restoration of confidence in the market and folks begin investing for the long term. And, although I'd like to see that happen soon, it may still be many moons away.

Also many of the bigger tech companies threw their money away trying to render Microsoft toothless, spending millions of dollars on briefs, attorneys and poorly conceived PR campaigns that resulted in no more than a slap on the wrist for Uncle Bill and the Boys from Redmond. That money would have been better served if it had been invested in the creation of superior products.

Take a look at how much money companies such as AOL/Time-Warner, SUN and, yes, even Oracle, threw away funding that suit, when those megabucks could have been used to shore up a sagging bottom line.

Wake up and smell the coffee, frizzy-dome. Oracle and others like it won't turn their stock prices around until they wise up and show investors they're more concerned about delivering a superior product than bashing the competition!

 

Tech sector stock prices aren't the only thing dropping -- checkout Mike's waist. The last time he saw his toes was in 1978.

That was then and this is now.

Most of the big name tech companies like Oracle, IBM, Microsoft, Siebel and SUN seem to be suffering the same fate -- a dropping stock price.

Why? Many experts are quick to blame it on a slowing economy saying that companies aren't spending money.

What do I think? I think that the problem is that there's a slowing economy and many companies aren't spending money.

What does it all mean? It means that the experts all followed my lead because I am the man!

Now from my perspective, I'd like to see this pick back up. I won't reveal what company I work for, but I'll give you a hint -- it starts with an O, ends with an E and has RACL in the middle.

Companies can only do so much when it comes to cutting costs. You can only lay off so many people and cut so many corners before running out of space to maneuver. It has to get better. It just has to!

With recent corporate scandals at MCI, Enron and Andersen Consulting, the government is starting to step in to ensure that either the CFO or CEO signs off on quarter ending results. It does make a difference. CEOs can no longer be off playing golf or sailing ships. They need to be more in tune with what's going on. Further, steps are also being taken to make sure that everything's accounted for including those precious stock options some are lucky to have. This could be bad and put many companies in the red.

I know the company I work for will turn things around. I'm sure of it. I'm willing to put Mike's job on the line as well as Larry Ellison's America's Cup.

You can quote me on this:

These companies will turn their stock prices around within the next year and make a full recovery. They have to, they just have to!

 
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