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Technology Stocks : Applied Materials No-Politics Thread (AMAT) -- Ignore unavailable to you. Want to Upgrade?

To: Cary Salsberg who wrote (7448)	10/8/2003 12:46:36 PM
From: Sam Citron	Read Replies (2) \| Respond to of 25522

Normally economists refer to capital intensity and labor intensity, and they are inversely proportional to one another. As the chip industry migrates to China, a relatively low-wage country, it would not be surprising to see some labor substituted for capital, to the extent that is feasible in the fab. I suppose the analyst could also be referring to the tendency of fab managers to try to delay equipment upgrades in order to save money in the short run, until they are sure that the the demand will be there. In this case why would it matter whether the analyst had in mind capex/revenue or capex/profit?