Signs of Recovery

This week I saw the first positive sign that relief from this recession may be ahead. I didn't find it on CNBC or the Wall Street Journal. I saw it on Ebay.

During the boom, Internet companies were wasting fistfuls of money on Aeron chairs and pallets of 1U and 2U servers. When these companies went bankrupt, their only assets were piles of crappy code, desk chairs and rack servers. The code ended up flushed down the toilet--along with the employees. The hard assets, however, ended up on Ebay.

When I looked several months back, there were some great deals to be had on rackmount servers. You could find tons of them on Ebay. It must have been a fearsome sight to server manufacturers: all of these computers available for a fraction of the cost of the unsold machines in their warehouses. In fact, I had a theory that manufacturers were pushing the blade form factor in a cynical attempt to make people think 1U and 2U servers were obsolete.

When I checked last week, I was surprised to discover the glut had dried up. There was little used equipment to be had. About all I could find were Intel ISP1100 barebones chassis servers, which are fairly lightweight (old socket 370, 100MHz bus) and somewhat awkward (no video, no CD).

This means that server purchases are going to have to go to the manufacturers rather than the used market. It also suggests somebody out there has been buying servers. This could mean recovery is ahead, and once technology spending picks up, the recovery will accelerate.

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re: Signs of Recovery

Recovery? Yeah, right... what about the billons in deficits created by Bush's tax cuts?. Who will pay for that?

The dollar has been in a free fall. I remember when Wall Street analy$t$ like Lou Dobbs laughed at the idea of the Euro. Well, they aren't laughing now.