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To: David Graham who wrote (4269)	3/6/1998 10:24:00 AM
From: Zeus549	Read Replies (2) \| Respond to of 7006

Grammy, I still say that price does matter. This is a supply and demand market. Price is usually an indicator of demand. If scrap prices are falling then demand from the mini mills is probably falling also which means less overall tonnage which means less revenue which will eventually mean less earnings because I do not believe overhead fluctuates on a one to one basis with the market. You can adjust your margins all you wish but 4% or 10% or whatever it is, is 4% or 10% of a smaller overall figure if price decreases. So the fact that they buy for less and sell for less thus "maintaining their margin" doesn't mean they will have the same earnings if there is price erosion due to slacking demand. Maybe I'm really dense on this, if so please explain.