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Technology Stocks : Intel Corporation (INTC)
INTC 48.32-0.8%Jan 15 3:59 PM EST

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To: Bernard Newman who wrote (27374)7/24/1997 2:00:00 AM
From: Barry Grossman   of 186894
 
Bernard,
I don't agree with your concept of growing sales and productivity "catching up" with the available technology. Technology does not stand still. In fact, the rate of increase of the introduction of new technology (that has the potential to improve productivity) is increasing. The computer that is replaced with a cheaper model is not deflation because for the same price as the original, you now buy a more technologically capable machine. Correspondingly, the '97 Explorer is a technologically improved machine vis a vis the '95 model.

To explain and understand deflation, you must compare the price of the same commodity at different times. An example might be the world price of oil. Lower future world oil prices, would be an example of deflation, if this occurred. Tell me Bernard, do you think that this will happen? How about food prices, raw material prices, etc? See what I mean?

Barry
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