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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: John Chen who wrote (28864)	8/30/1999 12:25:00 AM
From: ed	Read Replies (1) \| Respond to of 74651

Well, Mr. Chen, you probably realize that the business model of US high Tech industry is quite different than that of east Asia. The most valuable thing of the US high tech industry is innovation all the times, it is in the US which invented the transistor , which came the semiconductor industry, it is in the US which invented the first Main frames and PCs, which came the PC and software industry, it is in the US which first invented the internet , than came the e-commerce and revolution in the ways people communicate with each other...etc, so the business model for the US high Tech industry is always came up with new ideas, and inventions , as a result , new products and new industries, and it is a knowledge based industry, that is "Know How", which will set up a high , and very high barrier for others to catch up or even compete.In the Far East, the so called high tech industry is called labor cost advantage high tech industry, mainly is follow up . Can you tell me what is the difference of assembly Radios, TV sets, and PCs ( mother boards ) ? While people in the far east called the business of assembly Mother Boards high tech industry , while the assemble of radios, and TV sets traditional industry. But , all in all, they are all the same things "Assembly" but with different name. countries taking advantage of low labor cost to develop their what so called high tech industries is always to be replaced by countries which had even lower labor cost. Only the knowledge based high tech industries can not be replaced easily , because it takes much longer time to build up that knowledge base. As a result of the above, I do not think the US industry is over valued, because it is a knowledge based industry, and there is almost no competitors in the world in the near future. You can use the PE to judge the High Tech stocks, but you miss the most important ingredient of the High Tech industry, i.e the "Know How", "The knowledge ", the "Domination". The PE will never tell you these things. So, how high is high for the PE of High Tech industry ? No one can say !!!!! AG, just miss the point about valuation, and he came from the last century talking about the business model of this century !!!!