SB:
S. Korea has indeed been hurt, along with the rest of S.E.Asia. There is but one shovel with which these hard working people can dig their way back to the surface, and that is exports. A.G. also knows this and also knows that the only consequential buyers are on this side of the pond. That is why the printing presses are running 24 hours a day, flooding the U.S. with massive liquidity. Inflation is a good deal easier to live with than deflation. Will it work? I doubt it, but time will tell. A.G. has the problem of a consumer who is already up to his eyes in debt. The banks have already loaned to the "sub-prime" lenders, and are starting (underline just starting) to pay for this. I think the banks will just buy lots of treasuries, which helps out, what with the Japanese and the rest of Asia selling them (on a "repo" basis?). (g)
Forget the myth that the Koreans are not able to ship chips or get materials, etc. They are already prioritizing. They have large inventories that need to be converted into hard foreign currencies, and chips are the big producers of dollars. They will forgo all except rice to keep those container ships full and plowing furrows across the Pacific.
Then there are the Taiwanese, who do not have the debt problem, and who have mounted a massive expansion of fabs over the last two years. "Opportunity" is the message I get from contacts in that country. They will relentlessly exploit any chance to expand market share, and all players know it.
I'll bet on Jordon, especially as 64 Mbit cross-over arrives, which is just now occurring (64 Mbit price now equals 16 X 4 in some configurations).
Sub $1,000 PC's will keep price pressures on. I think memory prices will have trouble exceeding all-up production costs for the foreseeable future.
Best, Earlie |
