Brian.oco 0 Posting Whiz

Boy. What does a tech outfit have to do to get some love on Wall Street?

Intel announces a $7 billion effort to upgrade a pair of chip manufacturing centers in the U.S. and Intel’s stock price actually drops by over 3% in Tuesday trading (to $14..44 per share).

I’ll get directly to what Intel is doing in a moment but the overall stock market was down 300 points at noon-time trading, presumably because of the market’s reaction to U.S. Treasury Secretary Tim Geithner’s speech on the bailout this morning, and from President Obama’s press conference last night, pretty much on the same subject.

Clearly, Wall Street didn’t like what it heard from either gentleman. A big part of the problem is that Wall Street hates it when any attention goes to Main Street. So says analyst Tony Crescenzi of Miller Tabak in a note to clients his morning; Geithner’s message was aimed at the wrong target.

"The problem is that Geithner needed to speak more to Wall Street, where the problems lie, rather than stay at a distance as he did, and leave Wall Street with too few details with no roadmap by how it might find its way out of current difficulties," writes Crescenzi.

What did Geithner say to drive Wall Street down today? Summing up, he laid out the government’s plan to get the economy kick-started again.

Dubbed the "Financial Stability Plan," Geithner says the plan is aimed at four big targets:

1) It will set up a public-private fund to mop up to $500 billion of spoiled bank assets.
2) It will set up a consumer-lending facility to support up to $1 trillion in new lending.
3) It will devote up to $50 billion to help stem home foreclosures.
4) It will provide new funding to banks after a "stress test" to determine if the bank is healthy.

To me, it sounds like there actually is plenty of love for Wall Street in the new plan. But there is a healthy and growing doze of skepticism among traders and investors that the government really doesn’t know what it’s doing, and in calling a pork-laden, vote-buying grab bag a “stimulus” bill, is acting out a gambit that fools nobody.

But with the U.S. Senate voting to pass the nearly trillion-dollar porkulus measure, there’s not much left for Wall Street to do but sit back and see if it works. Or, see if it plunges the economy off the cliff and into depression.

In the meantime, Intel is one company that refuses to sit back and wait. Today it announced a new initiative to invest $7 billion over the next two years to expand and transform three U.S. manufacturing plants. According to the company, the new "super-fabs" could slash the costs to make everything from PCs and cell phones to set-top boxes and retail-sale systems.

That’s good news to 7,000 workers in Intel chip plants in Arizona, New Mexico, and Oregon. You’d think that Wall Street, once again, would approve. After all, the new Intel chip could lead to lower costs for things like consumer electronics, cell phones, and other Internet-connected devices. "The chips [that the new fabs] produce will become the basic building blocks of the digital world, generating economic returns far beyond our industry," Intel CEO Paul S. Otellini said in a speech at the Economic Club in Washington, D.C. today. "As a global company, we have made a conscious decision to expand these factories here because we believe that investing in the future of American discovery isn't just the right thing to do," Otellini added, "it is an essential business decision if we want the United States to continue to be the engine of new ideas and technical leadership."

Give if a few days, let the good news sink in, and we’ll probably see a bounce back in Intel’s stock price. Consequently, it could be a good time to be bullish on Intel.

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