The sales of PCs, desktops and laptops, are in decline. It’s not a forecast, it’s a reality that didn’t begin when Mr Recession rapped smartly on the door and the stock market fell out of bed. As can be seen in the graph a few paragraphs below, from ChangeWave Research, this trend began about a year ago. There was no sudden decline in buying intentions in November following the nightmare on Wall St. The trend just stayed in place.

This trend will continue. It’s inevitable. Unemployment is set to rise and that’s going to add to the inventory of desktops and laptops lined up for disposal on eBay, both from consumers and companies. The situation is further exacerbated by the fact that corporations currently aren’t inclined to upgrade their PCs just for the privilege of running Vista. One of the first calls I got after Wall St went deep sea diving was from a CEO who simply said that Vista was out of the question for a year. He’s thinking of skipping Vista completely and I’m sure he’s not alone.

The practical reality is that most budget decision in most organizations will be implemented round about now (January), so we don’t really know what the real damage to the PC market is yet, but the signs are not good.

The Economy

Let’s cut to the chase. There are some obvious trends that have already taken hold and which will inevitably persist. Economically, the contraction in the economy (worldwide) will not be reversed until sufficient government spending has actually been made to stimulate the deflationary trend. Reversing the current economic momentum (or lack of momentum, if you like) will not happen until the upside growth eliminates the downward momentum. This may not be an easy trick to pull off. There are unknowns and there are perils.

Here are some things to consider:

• The dominant world economy, if you think of it as an economic block, is actually Europe (with GDP greater than $17 trillion). The US is a little smaller (with GDP of $14 trillion). Taken together the two make up about 56% of the world GDP.

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