MILPITAS, Calif. " The semiconductor industry has adopted a "wait-and-see" attitude marked by vast uncertainties over the direction of oil prices, instability in Iraq and the presidential election, LSI Logic Chairman and Chief Executive Wilfred Corrigan said.
Those uncertainties are "absolutely going through to stock prices," Corrigan said in an interview with EE Times. "Personally I think it probably doesn't matter much who wins. It's a matter of getting it over with."
Corrigan noted that in the last presidential election year, the economy boomed until just after Election Day. Then the bubble burst. "Hopefully that won't happen this time," he quipped.
The industry veteran acknowledged that the semiconductor sector is closer than ever in the food chain to the end consumer, which has both its upside (greater value placed on semiconductors in the consumers' eyes) and downside (consumer cycles can be fickle).
"I listen to CNBC in the morning and the Wal-Mart sales figures come out, and you find yourself saying, 'How does that affect us?'" Corrigan said. "One estimate said the effect of $50 oil price is $7 in the pocket of average consumer. That's $7 of discretionary spending taken out of the average guy's wallet. So how does that affect what he pays for electronic gizmos?"
Corrigan also questioned recent concerns over inventory build up in the supply chain.
Market researchers Isuppli "said there's a bubble of inventory, but you went into it and there were only two days of inventory, around $800 million," he said. "The number for 2001 was $15 billion of excess inventory. It's one of those wait-and-see periods."