In the first of a series of reports from America's high-tech heartland, BBC News Online's Steve Schifferes reports on the challenges facing Silicon Valley.
Silicon Valley is the heart of high-tech America.
Here along the narrow peninsula south of San Francisco are concentrated many of America's fastest growing companies. During the past year the sales, earnings and stock prices of Silicon Valley companies soared as the US economic boom reached unprecedented heights. Many argued that it was information technology supplied by these companies that allowed America to grow at a higher rate than before, boosting the long-term output of the economy. But now that boom is slowing down, and the high-tech sector is feeling the pressure. Business confidence has fallen sharply, and companies are ordering less IT equipment.