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Technology Stocks : Advanced Micro Devices - Moderated (AMD)
AMD 214.18-0.5%Dec 31 3:59 PM EST
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To: chipguy who wrote (247850)2/15/2008 10:28:07 AM
From: fastpathguruRead Replies (2) of 275872
 
>A) Global supply instantaneously decreases by 20%

So what? The vast majority of PC purchases are completely
discretionary upgrades. So twenty million secretaries have
to make do with running Word and Excel on a 2.4 GHz P4
for an extra year or two. Surely the end of civilization as
we know it. :-P

So who allocates the supply? Who decides who doesn't get processors? First come first serve? You gonna let a secretary get your upgrade just 'cause she's first in line? Geeks mobbing Best Buy like brides fighting over dresses at a wedding expo? LOL.

Realistic answer: Raise prices and let the market sort it out.

B) Intel's demand instantaneously increases by 25%

Intel can supply perhaps ten million extra processors per
quarter to the market in fairly short order just by reducing
the ratio of quad cores to dual cores and delaying ramp
down of production of MPUs in N-1 process generation.
Given Intel's N-1 process generation MPUs are superior to
anything AMD can offer it hardly seems like an imposition
on buyers. ;^)

Ahh, the other side of the coin... Reducing the quality of output. Of course they'll maintain prices on the increasingly-scarce quad-cores just because, and build more fabs while maintaining low ASPs to satisfy growing global demand just because...

It is sad when AMD boosters have to rely on such specious
and flimsy arguments to pump up the importance of the minor
company they so closely and personally identify with.

I'm not pumping AMD, just talking "what if" and Econ 101. What's funny is your paranoid defensiveness and "insert excuse here" refutation of basic economic theory (decreasing supply + increasing demand + monopoly control of supply = increasing prices) when applied to your favorite company.

fpg
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