(FORTUNE Magazine) – In the 1988 Wes Craven horror movie The Serpent and the Rainbow, Bill Pullman plays a chemist who goes to Haiti to check out a drug that turns people into zombies. Pretty lame plot, as I recall, but the best thing about the flick was the famous tag line: "Don't bury me...I'm not dead!" See, I think that perfectly sums up the tech sector right now. Don't bury tech--it's not dead! Not even close.

We all know market swings are nothing more than extreme expressions of fear and greed. Never has that been more true than with the Nasdaq in 2000. Cold hard fact: The average daily percent change on the Naz in 2000 was about 2.25%! That compares with the 30-year average of 0.67%. (Thank you, day traders, CNBC watchers, and momentum investors!)

So let's step back for a minute. Everybody and his nephew's dog's barber knows that tech stocks were unbelievably insanely overvalued last spring. But isn't it possible they're similarly out of balance on the undervalued side about now? As I'm writing this, the index is down 50% from its peak on March 10. That's not a correction or a bear market--that's a deep depression! At some point, low becomes cheap. (Remember, you're supposed to buy stocks when they're on sale, not pay full retail!) Even Barton Biggs, the biggest, baddest tech bear of them all, recently turned slightly bullish, telling Morgan Stanley clients to "buy tech for the rally."

Take Cisco. On March 27, CSCO closed for its first and only time above $80. Since then, it's gotten creamed like corn. Puppy now trades at $36. The last time this stock sold for 36 bucks was on Nov. 5, 1999. Which is significant, because the true valuation madness went down between November 1999 and March 2000. Other examples: Sun's now at $26, where it was in November 1999. Intel's at $32, where it was in October 1999. So I say throw out that burst of irrational exuberance, as well as the ensuing fall. Because the underpinning, my friends, the underpinning (as well as the song!) remains the same.

There's more to this than just undervaluation. There is growth. Heart-pounding, to-the-moon-Alice, take-your-protein-pill growth. Remember the talk before this recent carnage? How technology was going to change the way we work, live, love, and play? Change the way businesses were going to grow, flow, think, drink, and everything? From the way people are acting right now, you'd think that talk was all malarkey. It was true then, and it's still true now. In fact, you could argue that the digitization of society continues to accelerate. Yes, there are hiccups. We have an insatiable need for bandwidth, but guess what? There's a glut of telco companies out there. Too much money chasing too few deals. It's the downside of a robust market. Or data storage, where EMC has fallen from $104 to $55. You think that means storage is over? (I won't even answer that.)

Then there's the PC business. Every year over the past decade, some weepy wonk tells us the PC market is about to collapse. And every dang year the biz grows 15% (about where it will come in for 2000). Worst case: Growth slows to maybe 9% or 10%. And even if the go-go days of the PC era are fading, so what? That just means the beginning of the post-PC, handheld, peer-to-peer, Palm OS, Unix-server, smart-microwave-oven, et cetera era. In other words, the end of the PC doesn't mean the end of computing! In fact, it really means computing is becoming so vital that a PC is too limiting. Computing power will tend toward ubiquity. I mean everywhere, baby! If that doesn't tell you the revolution is still intact, I don't know what does!

I was reminded of all this the other day while grabbing some gumbo in the Merrill Lynch executive dining room with Steven Milunovich, that firm's chief tech strategist. Stevie actually happens to be kinda bearish on tech stocks right now. "You're still coming off a period of extreme valuation, and now you have the slowing economy," says he. Milunovich doesn't think the time will be right to buy tech stocks until midyear. (Seems arbitrary to me, but that's another story....) But even before the entrees arrive, I discover that Milunovich really isn't that doomy and gloomy after all. He sees the numbers, so how could he be? Capital spending on information processing amounts to about 5% of GDP today. In the 1880s spending on railroads, the backbone of the then-burgeoning industrial economy, peaked at 12% of GDP. (Can you say "gap up"?) Milunovich believes that the great Internet infrastructure build-out is only 20% complete. Who will benefit? Companies like EMC, Cisco, Critical Path, HP, Oracle, Portal, SAP, and Sun. In fact, Sun's CTO, Greg Papadopoulos, calls our current situation the 10[8] Internet, meaning 100 million devices are hooked up to the Net today. In three to five years, we could well be at a 10[10] Internet, with ten billion devices connected.

When that happens--and it will--the memory of Tech Slide 2000 will be nothing more than a hazy fin-de-siecle memory. So, is tech dead and buried? What do you think?