Wall Street is always grateful to hear of job cuts, and Sun's decision to shed 11 per cent of its staff - or 4,400 people - saw its stock rally by almost ten per cent.

The index saw its biggest rise for nine months in July when record unemployment figures were announced.

We've noted the wisdom and foresight of financial analysts here before. We've noted that compared to its rivals, Sun is doing extremely well in the harshest recession the technology industry has ever known. We've also noted that long term investment is needed in work that brings high margins and profits in the future, which is exactly what Sun is doing.

But analysts have a long term problem with the company, and will only be sated by more blood.

"Sun risks becoming the Apple of corporate computing, cool but less relevant," reckons Merrill Lynch analyst Steve Milunovich (via CRN).

Merrill Lynch's previous public recommendations have included eToys, Pets.com and host of other stocks it privately described as "junk," "crap," "dog", "disaster" and "POS", or "piece of shit". Merrill Lynch was fined $100 million for deception under the Martin Act, a New York state consumer fraud law.

NY's Attorney Spitzer argues that the health of the state depends on the credibility and integrity of its capital markets.

Milunovich may be right - if Sun faces a new and unexpected disruptive technology, and can't respond - (he think this is Itanium) - or if enterprise hardware systems and software will very soon become a commodity game where the only thing differentiating these million dollar computers will be their color.

In short, he asks us to believe that the world of new technological innovation has simply stopped turning, and the future belongs only to companies who can amortize what little R&D is needed down to their distribution channels, that employ not people, but robots and felons.

Sun posted a net loss of a mere $78 million, 2.8 per cent of the $2.7 billion worth of income in the quarter.

Best of luck to our many friends at Sun, and other companies where the stupidity and greed of the Wall Street sages takes a human cost. ®