Big money can be made shorting the technology stocks, as they get ready for 50% crash
Fred Day
Nov. 19, 2006

Smart money is ready for it now. The divergences are biggest. Cycle study says it is the massive Bull Run finally came and is now a part of the history. The Fed’s interest rate pause made all the money sitting in the sideline jump shift into the market. Most of the money from the tax cuts went also into the market fueling its upwards thrust. Now the market looks back from the top of hill to the fundamentals.

The technology sector is most vulnerable just like 2000. The presumption in high tech companies like Dell, Microsoft, HP, Intel, Motorola, TI and so on is that it will be able to sell into the big thirst of capital improvement cycle long due. That will never come. The small companies that really fueled the 1995-2000-technology boom have shifted its gear. It is less dependent on technology at the individual employee level and more dependent on enterprise server level. No matter what Microsoft projects, very few companies are planning to upgrade to Vista. The technology companies will have to face the reality. It is tough out there unless you are privileged to rich by inheritance and of course privileged to be paying less tax because of recent tax cuts.

The companies like Apple and Microsoft that have little exposure to technologies other than computers are most vulnerable. The companies that depend on cell phones are in trouble too. The global cell/mobile phone sells has peaked and will soon crash led by India and China. The reality in third world countries is that people buy devices and cars to use for ten to fifteen years. You cannon sell the same lemon to them again in two years like in America. Indian and Chinese will upgrade their phones after seven to eight years. The tendency of the tech companies will be to render these devices obsolete as they have done in the Western world. But the Governments in China and India will intervenes threatening indigenous development and promotion.

Big money can be made shorting the technology stocks, as they get ready for 50% crash
Fred Day
Smart money is ready for it now. The divergences are biggest. Cycle study says it is the massive Bull Run finally came and is now a part of the history.
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