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To: Jonathan Bird who wrote (10980)	12/11/1997 12:31:00 AM
From: Jonathan Bird	Respond to of 12298

A verticly intergrated DD producer is competing just as much with suppliers as they are producers. You really got me thinking now Brian. Look at it this way. Drive prices fall-> drive margins fall-> Suppliers have two choices: 1. maintain margins -> producers can't compete -> producers go out of business -> suppliers lose customers -> suppliers go out of business. 2. Decrease margins -> producers are more competitive -> producers hopefully survive -> customers are maintained -> but suppliers suffer just as much as producers. The good news is that it takes time to put pricing pressure on suppliers. So margin problems with drive producers are like early warnings about margin problems with suppliers. Why do I get the impression I should have realized this a long time ago. We are ALL doomed. Shorting RDRT, HTCH and KMAG tomorrow.<g> Jon Bird