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Technology Stocks : 2000 Date-Change Problem: Scam, Hype, Hoax, Fraud
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To: Done, gone. who wrote (196)10/6/1997 4:07:00 AM
From: Sid Turtlman   of 1361
 
Michal: There is a flaw in your reasoning so wide that there is room to drop several Y2K problems into it, and still have room for all the world's spammers and hypsters.

You seem to think that if the total amount to be spent on solving the Y2K problem is going to be $50 billion, then the total market caps of all the companies involved in that effort should equal that amount. Possibly, if this were a market spending $50 billion per year forever, and if it were a market in which all the players would earn decent margins, thus making one times sales a reasonable valuation level, then there would be some logic to what you say. But $50 billion, if that is the number, is the total of all the money spent (most of it internally, not with outside vendors) over a several year period, and then that is it; it goes to zero.

Why don't you get excited about the 2000-2050 car problem? That is the problem that I just made up, which is: All the cars operating today will no longer work by the year 2050! They will all have to be replaced at a cost of $trillions. That means that the total market cap of GM, Ford, Toyota, etc. should now add up to $trillions also. So they are all wildly undervalued. That makes as much sense as your post.

I can't see why the total market cap of all the players should be more than a tiny fraction of the total being spent over the next few years.
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