I am a big fan of Rich, and I didn’t intend to “negate his work”. I don’t think he made any strong conclusions from that data, and he really can’t. My point is: the chart is interesting, but not too useful. We can’t make too much out of inventory falling unless we know how much sales fell. I agree with sduuude (gosh, can’t believe he and I are getting along now….too weird to figure that one out), that it is months inventory that matters.
So what if inventory falls, if sales are falling the same amount or more? We need a chart of sales next to the chart of inventory.
If months inventory is rising, pricing pressure will keep falling. So I think that months inventory is a more useful chart, if you wanted to have only one chart.
I think that Rich appreciates my comments, because ultimately we are all collaborating on figuring this stuff out.
