Monday, December 5, 2011



Are markets/analysts too myopic, or just see the wrong things? Here's a couple of examples that readily spring to mind.

PIC is up 15% today - up 30% since the beginning of the month (!) - from very very low levels I might add - on news that its hard disk supplier, Western Digital, is restarting its operations after flooding of its factories halted production earlier this year. The point is, when you think about it, did the market really believe that production capacity for hard drives had really been wiped out permanently? Even if WD did go bankrupt as a result (it hasn't happened in the case, but catastrophes at factories can be a source of bankruptcies), it seems likely that some other manufacturer would be able to increase production, or bring new facilities online eventually.

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