Qualcomm Incorporated (QCOM) Message Board

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Technology Stocks : Qualcomm Incorporated (QCOM)

QCOM 174.35

-0.4%

Dec 4 3:59 PM EST

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To: Maurice Winn who wrote (16080)	10/7/1998 12:08:00 PM
From: dougjn	Read Replies (3) of 152472

You are absolutely right. Do a thought experiment. You and I are the only people in the world. Your entire net worth consists of 2 Qcom shares, last quoted at $50 per. My entire net worth consists of $100 in folding money. You sell me one of your two Qcom's for $50. Now you still have $100 of wealth, half in cash and half in Qcom stock. So do I, with the same allocation. Tomorrow morning the word gets out that Qcom is going to miss future projections because Korean PCS companies have stopped aggressively subsidizing cell phone prices for new subscribers. They just can't afford it anymore, apparently. People worry that some customers, at the margin, won't pony up the higher phone prices themselves, and will hold off starting up service. Qcom is quoted at $40 asked. You now have that $50 in cash and $40 in Qcom stock. I'm in the same position. We both have $90 in wealth. You're patting yourself on the back for saving yourself $10, at least. I'm cursing myself for jumping the gun. But where did that total of $20 go? It just disappeared. Who got it? Nobody. Does it matter? Well, if the decline is big enough, overall, it does matter. Wealth has been destroyed. Doug

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