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Technology Stocks : Intel Corporation (INTC)
INTC 50.70+5.0%2:46 PM EST

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To: Fred Fahmy who wrote (29554)8/18/1997 10:00:00 PM
From: Barry A. Watzman   of 186894
 
Fred,

Some money may flow out of the stock market in general or Intel in particular. But it is insignificant in comparison to the amount of money that is lost. If Intel drops $10 on a day when 20 million shares were traded, perhaps $200 million went out of Intel. But intels market cap drops by 1.4 billion shares x $10 or $14 billion dollars. The $200 million that might have truely gone out of Intel is almost insignificant in comparison to the total decrease in Intel's market cap, and the difference is not money that went out of the market or out of Intel, it is money that simply disappears into thin air. The same thing happens to every other stock. In general, when the market declines, while some money may indeed have "moved" from the stock maket to some other financial instruments, a much greater sum (thousands of percent greater) just disappears into thin air.
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