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To: Chuzzlewit who wrote (95751)	2/7/1999 2:03:00 PM
From: Skeeter Bug	Read Replies (1) \| Respond to of 176387

chuzzlewit, of course, the supply of pentiums is equal now to the supply of ibm mainframes, right? NOT! supply has grown than demand so prices have dropped. if you take all the pentiums except one and throw them in the water, ban all production of future computers and get rid of all realistic competing products then the sole pentium left would cost much, much more than any ibm mainframe could ever have brought in... the only difference being supply relative to demand. i've said already and i'll say it again, efficiencies tend to increase supply but this does not have to be the case. >>Technology has always existed in a disinflationary environment.<< there was inflation in dram earlier this decade. don't use the term always if you don't know what it means...

To: Chuzzlewit who wrote (95751)	2/7/1999 2:26:00 PM
From: BGR	Read Replies (1) \| Respond to of 176387

CTC, If IBM can't sell superior PII machines at the same or better price than an inferior 360 machine and pocket the difference gained from improved cost efficiency via better technology, it simply means that demand for PII's at a price of 360's do not exist. Generalizing, this in turn means that since 1960's demand for computers have weakened (it may seem different on the surface), otherwise manufacturers could have held prices steady or increased prices as the performance has improved. Which in turn means that the computer industry have always been fighting an uphill battle and any prudent investor would short the industry as sooner or later they were going to crash. Y2K is the trigger. Right SB? -Apratim.