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Technology Stocks : Dell Technologies Inc.

DELL 126.42

+2.8%

Dec 19 9:30 AM EST

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To: Meathead who wrote (41027)	5/8/1998 3:14:00 PM
From: Jim Patterson	Read Replies (1) of 176387

re: One only needs to look to the auto industry as a comparison to see this relationship. Appliances come to mind as well. Meathead, The auto industry is an incorect industry for any kind of comparison, especialy on price. Auto makers do not devalue their products like the tech industry does. Ford will not lower the price of a new model year ever. If they did, they would be devaluing every auto they ever made. Today it would be even worse. Lease pricing / monthly payments are all based on the resale value of the vehicle at the end of the lease. If Ford cut the price of a 199 Explorer by 1%, then all resale values of Explorers would also decline. Now Ford has a lot of assets on the books as leased vehicle. A price cut would cut straight into their balance sheet. Now the new model may have more standard features which make the sticker higher, but in the broad picture, the price is higher. Now take the PC industry, where inventory drops by 1-2% per week. I am just pointing out a big difference in how two industries work. Jim

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