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Technology Stocks : Ascend Communications (ASND)

ASND 220.42

+4.9%

Dec 12 9:30 AM EST

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To: craig crawford who wrote (7884)	8/2/1997 12:03:00 PM
From: Chuzzlewit	of 61433

Yep -- it's called "barriers to entry". The problem I was alluding to isn't the development costs of hi-techs. As you correctly pointed out, many hi-tech areas have virtually no barriers to entry and development costs are very low. The problem comes when customers defer purchases when interest rates rise. This is particularly acute for capital purchases, but the spill-over to less capital intensive purchases is inevitable. If you defer purchasing a new factory you have also deferred purchasing computers and networking hardware and software and paper clips. So the bottom line is that rising interest rates impact all businesses, albeit in varying ways. Regards, Paul

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