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Politics : Ask Michael Burke -- Ignore unavailable to you. Want to Upgrade?

To: Knighty Tin who wrote (62526)	6/16/1999 1:49:00 PM
From: yard_man	Read Replies (2) \| Respond to of 132070

Looks like a good reason to rally to me fnews.yahoo.com >>Prices for memory, or DRAM, disk drives and processing chips -- the guts of the PC -- are near their all-time lows. "We have seen an incredible acceleration in the price decline of components across the board," says Randy Befumo, an analyst at Legg Mason Fund Adviser. This does not bode well for the margins at chip companies -- think AMD (NYSE:AMD - news) -- and disk-drive makers. The problem is that chip companies make their big profits on spanking-new products such as Intel's (Nasdaq:INTC - news) Pentium III, but consumer demand is for the lower-end products, like the company's cheaper Celeron line. Intel recently made across-the-board price cuts in its Pentium III line. This sort of rapid price deflation is evident throughout the chip industry. While chip prices for over-$1,000 PCs are relatively stable, low-end processor rates are "on a pretty steep curve down," says Dean McCarron, principal at Mercury Research, a semiconductor research firm. Intel's Celeron 300, for example, which sold in the second quarter of 1998 at $148 per chip, was priced at $54 by the first quarter of this year, notes McCarron. Memory prices also have dropped precipitously: Legg Mason's Befumo notes that memory prices have fallen faster than he has ever seen over the last few months. DRAM prices for 64-megabit chips cost $6 "or even less," notes Befumo, which is a record low. The two funds that Befumo works on have positions in Gateway (NYSE:GTW - news) , Dell (Nasdaq:DELL - news) and Compaq (NYSE:CPQ - news) , according to the latest filings from Technimetrics. <<