2HRS2GO: A Christmas wish list

COMMENTARY -- Dear Santa:

How are you? We trust the North Pole weather is suitably cold for you, though hopefully not as cold as stocks have been this year. The Nasdaq is down almost 40 percent year-to-date. Almost 70 percent of this year's new offerings now trade below their IPO price, and 250 companies abandoned IPOs altogether. Millionaires became thousandaires.

In the early part of this year, we were probably high on your list of bad kids. We threw money around recklessly -- to the tune of $61 billion on the aforementioned IPOs. We margined ourselves on the way to Nasdaq 5000. We bought into the hype, while ignoring the obvious signs of bad business models.

We committed other sins. A bad egg spread a false report about Emulex (Nasdaq: EMLX) and we immediately sold on knee-jerk reactions without doing the slightest bit of checking. We pushed B2B commerce to the moon before someone pointed out that these online exchanges are relatively low value propositions in many cases.

But we suffered for our errors and learned from them. We have been good children for the last few months, and we still believe in the system.

However, PaineWebber's latest Index of Investor Optimism is now at its lowest level since 1997. That's where you can help, Santa. We can be better, happier kids next year if you drop us a few gifts:

• Interest rate cuts.
Mr. Greenspan has again demonstrated his skill at controlling inflation, and he deserves plenty of credit. Now please convince him to take it easy on us.
• Killer PC apps.
A growing number of consumers feel no compelling need to buy a personal computer these days, judging by cautions from Gateway (NYSE: GTW), Apple (Nasdaq: AAPL), Compaq (NYSE: CPQ), Intel (Nasdaq: INTC) and Advanced Micro Devices (NYSE: AMD). Surely your elves can cook up a must-have piece of software that requires 1 GHz and faster machines.
• Faster bandwidth expansion.
Communications equipment buyers are cutting capital budgets, but if we could widen the network pipe at faster pace, all sorts of applications become viable. Corporations will need more servers and storage network capacity. Online media becomes watchable.

And there are plenty of VC-funded companies waiting for the chance to show their wares (and go public) on a speedy Internet. Maybe you could even get a broadband link at the Pole.

• A global wireless standard.
Handset sales are down and the promised land of access-anywhere devices remains elusive. Help the world sift through the GSM-TDMA-CDMA acronym casserole. Create practical, affordable devices that use Bluetooth and WAP. Don't let our wireless investment dollars go to waste.
• Better models for online advertising.
Let's face it, we like the Internet because it's a great source of seemingly free information. Actually, it's not free -- ads pay for it.

But advertising is slowing down for all media, especially the Web. Wall Street walloped Yahoo (Nasdaq: YHOO) in recent months on ad worries. Better results from online ads would convince companies to boost their Web marketing budgets, which would boost the survivors of the dot-bomb explosion, turn them into solid stocks and make everyone happy. Mrs. Claus is a clever lady -- perhaps she can come up with something?

It may sound like a lot, but we know you're up to the challenge. You can benefit yourself -- the workshop would benefit from the efficiencies needed to stimulate the tech industry. The elves will find it far more interesting than another batch of wooden toys. And they'll stop complaining about losses in their 401(k) plans.

So keep us in mind as your work season approaches crunch time. As usual, we'll leave the cookies on a plate, next to a glass of milk sitting on a coaster generously provided by America Online (NYSE: AOL) in the form of a 700 Hours Free! compact disc.

Regards,
Technology Investors.

P.S. Some of us may attach other gift requests in the Talkbacks section below. We are a demanding bunch, but you know that already, Santa. Bless you for your patience, and enjoy the holiday season. 22GO>