And then I know when we look at oil prices, I know Wall Street every day for the past couple weeks has let us all know that lower oil prices is bad for the stock market I guess, but for consumer demand for people that may want to buy a car or buy a product whose oil prices dropped 50%, I don’t if we fully anticipated economically what that impact will be in the next year or two or so. So you said, our mid-point is a little higher than the four percentage you alluded to, but not dramatically higher than that, so we feel we can do what we have estimated.
Amit Shah
This point on oil prices, Paul, is an interesting one. You mentioned that it has potential positives and negatives for Linear. I am curious what you think it means for your industrial business. My impression would be that this would negatively impact your industrial business, but based on your outlook it sounds like things are pretty good.
Paul Coghlan
I don’t off-hand know why you would think it would be negative. One of the significant costs to an industrial company is generally the cost of energy — heat, light and power. To the extent that cost is less, that would give the money that they could fund projects like someone earlier asked us about how our wireless business is going and those of projects that industrial companies have to decide the fund and they don’t like abort, so I think if they have a little more lower expenses that can give the more cash to help fund projects like that. What particularly did you have in mind as to why lower oil prices would harm industrial companies?
Amit Shah
Well, my understanding is that many of these companies have 20% to as much as 50% of their revenue exposure to the oil and gas markets and given the decline in the commodity that might in fact affect their CapEx investments and therefore spending on a projects that Linear maybe tied to.
Paul Coghlan
Well, again, I haven’t heard that percentage, but I would personally think that industrial companies have much greater exposure to the automotive end-market than they would to the down-hole exploration end-market so that certainly in Europe a lot of industrial companies feed into the automotive market and there if you have a lower fuel cost, you may have people willing to buy new car sooner.
Lothar Maier
Maybe, if I can add, from an industrial customer the benefit of low oil prices is not just in their electrical bills, but a lot of raw materials have their origins in petroleum as well, so I think you will see of a broader impact as well where just the cost of raw materials that have their source with the petroleum are also going to go down which I can only see being good for our industrial customers.
Bob Swanson
Yes. I saw another statistic that said that what this $50 a barrel price means to consumers in the US alone is an extra $400 million a day of extra money they had to spend. They could buy things that drive all kinds of markets.
Amit Shah
Yes. I mean, your logic make sense. You would not know what they were looking at the way industrial stocks are trading today, but I appreciate the feedback, guys. Thank you.
Paul Coghlan
Alright, thank you, Amit.
