Farmer In the Dell

True confessions.

Some time in early October last year, the alleged investment expert who manages my retirement account bought a few stock shares in Dell Computer. The price had tripled during the year to $105 per share, and, despite those heady heights, showed nary a whiff of weakness.

So this erstwhile Einstein buys it just in time for the Asian crisis on Oct. 27. Dell dove down to $75. Fortunately, m'main man of the markets doesn't panic, waits for a rally, and sells at $85, priding himself of having "sold into strength."

Strength? You want strength? I'll give you strength. How about Dell last week at $126, up 48 percent from my departure point? How about 1,500 brand new millionaires among Dell employees last week?

Kinda gives my market maven the strategic brilliance of someone who fell off the turnip truck as it passed by Wall Street.

I'd fire this brutish brainiac, but, well, let's just say that while he will remain nameless and has absolutely no affiliation with Merrill Lynch, his initials are somewhat similar.

The point here is not to parade the painful details of flawed performance in the McCormick portfolio, but to underscore the truly incredible nature of the American economy, an anthem sung well by Dell.

Ponder upon what has happened since early October. Asian markets - a third of the global economy - have collapsed.

Yet the American stock market, an indelible tower of strength, set about a dozen record highs this month - none of them more dazzling than Dell's.

It - more than IBM, more than General Electric, much more than General Motors - has become the poster child of America's stunning New Economy.

Dell reported a 52 percent jump in profits during October, November, and December, the same months when economists wrung their hands about Asia.

Yet during that period Dell doled out 71 percent higher profits from Asia.

Granted, Dell has a small presence in Asia and therefore plenty of room to grow, but the real message here is: Don't underestimate companies like Dell, and the economy that gives them shelter.

Some delightful details on Dell:

It's high-tech in a country that can't get enough of technology. It undercuts competitors in making and selling computers. And it recently delved into the hottest forum of American commerce, the Internet - selling computers directly from its Web site. Orders run $4 million a day - no phone operators, no retail stores, no sales commissions, no catalogs.

Just "click here." Does anyone still not understand why the Internet is changing American business?

Analysts also consider Dell one of the most efficient manufacturers anywhere. Corporate customers call - or click - in an order, and Dell builds and ships a customized batch of computers in an average 11 days, compared with about 25 days for other computermakers.

The founder of the company, Michael Dell, barely out of his 20s, and his stock in the company is now worth a reported $7.4 billion.

That's the American economy: technology-driven, innovative marketing, competitive pricing, youthful energy, quantum improvements in productivity.

Dell faces plenty of tough competition, but virtually all of it comes from US companies. And please, don't run out and buy the stock. At $126, it's pricey.

But whatever you do, don't sell short the US economy.

Comments? mccormickl@csps.com

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