Tech spending

Discussion in 'Trading' started by bungrider, May 5, 2003.

  1. This is just off the top of my head, but hear me out --

    It seems to me that tech spending may not be the most reliable indicator of economic vitality in the long run, in the sense that tech equipment has a very short shelf life and constantly needs to be replaced anyway. Having a tech budget seems to me as normal as having a budget for insurance in that it is a required, and not an optional, cost.

    There will always be a demand for tech, whether its hardware OR software, simply because better stuff comes out all the time and the older stuff must be replaced...

    Tech spending is up in 2003 if you watch the SOX, and to me it seems that the SOX is the only thing that's holding up the market now that homebuilders and defense seems to be cold.

    So what kind of spending would show true economic growth?? Maybe hiring more people? The trend is more layoffs, not more hiring, so according to this theory, the economy is getting worse.

    I'd love to hear some thoughts on the strength of tech, and its validity as an economic indicator.