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Reply #121: Yes, it will be. [View All]

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Yo_Mama Donating Member (1000+ posts) Send PM | Profile | Ignore Sat Dec-10-11 04:13 PM
Response to Reply #115
121. Yes, it will be.
I look at two fundamental things in evaluating companies - the ratio of debt to profit on sales, and the cost of acquiring additional sales.

Because of the rebound in company net worths, which has come back to just about where it was when we entered recession, and because of the rebound in Other Deposits at banks, I think that we have come through the worst of it.

Still, companies have too much debt and real incomes for households look bad, so we have some lean years ahead. But I think we've passed the worst until we hit the federal recession, which is coming in a few years.
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  -Somebody please explain to me why are corporations hoarding cash. How is that good for them. thereismore  Dec-09-11 11:26 AM   #0 
  - If Obama would play ball and let them bring it back in at 5 percent problem solved  Skink   Dec-09-11 11:31 AM   #1 
  - I haven't thought about that angle in this whole debate  Maccagirl   Dec-09-11 11:33 AM   #3 
  - Oh Hell to the no!  dawg   Dec-09-11 03:09 PM   #23 
     - Then they won't...  Cid_B   Dec-09-11 05:10 PM   #43 
  - My theory: a capital strike  Lydia Leftcoast   Dec-09-11 11:32 AM   #2 
  - And it is coordinated with the GOP Senate and House leadership  emulatorloo   Dec-09-11 12:35 PM   #14 
  - Or the business climate is poor and uncertain?  hack89   Dec-09-11 04:37 PM   #34 
  - It's poor and uncertain because people aren't buying  Lydia Leftcoast   Dec-09-11 05:18 PM   #45 
     - Everyone is waiting for the shoe to drop in Europe  hack89   Dec-10-11 10:58 AM   #67 
        - Conventional business school BS  Lydia Leftcoast   Dec-10-11 11:36 AM   #72 
        - I saw one company that wants to give a $100 million separation fee  Aerows   Dec-10-11 11:43 AM   #76 
        - "Tight lending standards"?  Aerows   Dec-10-11 11:39 AM   #74 
           - So if you tighten fiscal standards for corporations  hack89   Dec-10-11 11:48 AM   #78 
              - That means that they lend to people  Aerows   Dec-10-11 12:10 PM   #80 
                 - I agree we need banking reform.  hack89   Dec-10-11 12:15 PM   #81 
                    - Nope  Aerows   Dec-10-11 12:17 PM   #83 
                       - US banking laws will not impact global lending  hack89   Dec-10-11 12:39 PM   #90 
                          - Good  Aerows   Dec-10-11 12:48 PM   #95 
                             - Exxon paid $78 billion globally in taxes - $7 billion in various US taxes  hack89   Dec-10-11 01:21 PM   #101 
                                - And they got subsidies  Aerows   Dec-10-11 01:39 PM   #103 
  - it also shows that the concept of an "american" company  newspeak   Dec-09-11 04:40 PM   #35 
  - self-delete: dupe  meow2u3   Dec-09-11 06:00 PM   #47 
  - I see the same thing as you do  meow2u3   Dec-09-11 06:20 PM   #48 
  - Wow, thanks for the new information. Great post.  Shoe Horn   Dec-09-11 07:08 PM   #56 
  - Just like the boycott against purchases of luxury items back in late  Ilsa   Dec-09-11 08:12 PM   #59 
  - Your theory is totally wrong  Yo_Mama   Dec-09-11 08:20 PM   #62 
  - "Businesses over-borrowed"  Aerows   Dec-10-11 03:36 PM   #116 
  - My theory: their 40 year project of gutting the discretionary income of the 99%--  eridani   Dec-10-11 09:34 AM   #64 
  - When/if business conditions improve, they'll be able to invest in growth.  lumberjack_jeff   Dec-09-11 11:34 AM   #4 
  - is that it?  grasswire   Dec-09-11 11:51 AM   #10 
  - Collectively, I suppose so.  lumberjack_jeff   Dec-09-11 12:25 PM   #12 
  - Not necessarily  hack89   Dec-09-11 04:36 PM   #32 
  - what lumberjack_jeff said.  dawg   Dec-09-11 03:17 PM   #24 
  - And people don't buy their shit  Aerows   Dec-10-11 11:45 AM   #77 
  - They can pay out higher bonuses to top performers  TBF   Dec-09-11 11:35 AM   #5 
  - Raising cash for post-crash (to come) firesale buyback- eom  Huey P. Long   Dec-09-11 11:36 AM   #6 
  - It raises the Misery Index  LiberalEsto   Dec-09-11 11:37 AM   #7 
  - This may backfire on them  meow2u3   Dec-09-11 06:26 PM   #50 
  - they're in survival mode  SixthSense   Dec-09-11 11:46 AM   #8 
  - pretty much  BOG PERSON   Dec-09-11 02:31 PM   #19 
  - Capitalism!  RDANGELO   Dec-09-11 11:48 AM   #9 
  - The answer to the question depends  MakingSense   Dec-09-11 12:21 PM   #11 
  - The Obama administration isn't pro-business?  Lydia Leftcoast   Dec-09-11 12:41 PM   #15 
     - I believe  MakingSense   Dec-09-11 12:56 PM   #17 
  - What do you think that they should do with it?  Freddie Stubbs   Dec-09-11 12:28 PM   #13 
  - Using it to buy back stock apparently jiggers the end of quarter numbers  BR_Parkway   Dec-09-11 12:43 PM   #16 
  - Simple  Ohio Joe   Dec-09-11 12:58 PM   #18 
  - I have a question for anyone who knows. When it's said they're "hoarding cash,"  WildNovember   Dec-09-11 02:35 PM   #20 
  - In bank accounts.  ParkieDem   Dec-09-11 03:40 PM   #26 
  - Depends on the bank.  Prometheus Bound   Dec-09-11 06:44 PM   #53 
  - The problem is not where the money is...  Ohio Joe   Dec-09-11 03:45 PM   #27 
  - Well theoretically, unless the money is buried in the back yard, it enters  WildNovember   Dec-09-11 04:10 PM   #29 
     - "Lending"  Ohio Joe   Dec-09-11 04:13 PM   #30 
        - not necessarily, no. but typically the lending is for some kind of economic activity which  WildNovember   Dec-09-11 04:36 PM   #33 
           - It may help maintain or slow decline but...  Ohio Joe   Dec-09-11 04:41 PM   #36 
              - If the money is moving, they're not sitting on it. That's my point. So I don't  WildNovember   Dec-09-11 04:48 PM   #37 
                 - "Sitting on it" means it is doing jack shit for jobs or the economy  Ohio Joe   Dec-09-11 05:06 PM   #41 
                    - If it's being loaned, it *is* doing *something* for the economy. Which is my point.  WildNovember   Dec-09-11 06:43 PM   #52 
                       - It's not snark, it's the truth  Ohio Joe   Dec-09-11 06:51 PM   #54 
                          - whooosh. Never mind.  WildNovember   Dec-09-11 07:00 PM   #55 
                             - "velocity of money", look it up. -eom  Huey P. Long   Dec-10-11 11:42 AM   #75 
                                - I know what the velocity of money is. If you care to expand, great, but just  WildNovember   Dec-10-11 12:35 PM   #88 
  - Yup, someone does know.  Yo_Mama   Dec-10-11 04:36 PM   #125 
  - Not an economist, but I think it's mainly a combination of 2 factors.  cemaphonic   Dec-09-11 03:04 PM   #21 
  - They are investing in emerging markets.  mmonk   Dec-09-11 03:05 PM   #22 
  - "Emerging" = anywhere but the US.  Initech   Dec-09-11 03:53 PM   #28 
  - my theory  mick063   Dec-09-11 03:23 PM   #25 
  - Can you explain a little more? When someone buys a derivative, who do they  WildNovember   Dec-10-11 12:43 PM   #93 
     - my favorite explanation  mick063   Dec-10-11 02:37 PM   #108 
        - thanks for the video.  WildNovember   Dec-10-11 05:23 PM   #126 
  - They can't buy demand for their products.  hack89   Dec-09-11 04:34 PM   #31 
  - What should they do with it?  mick063   Dec-09-11 04:53 PM   #39 
     - You really think central planning of the economy will work?  hack89   Dec-09-11 05:09 PM   #42 
        - central planning  mick063   Dec-10-11 09:47 AM   #65 
           - So explain to me what you want companies to do with that cash? nt  hack89   Dec-10-11 10:53 AM   #66 
              - What I want with that cash?  mick063   Dec-10-11 11:02 AM   #68 
                 - And give more back to the shareholders?  hack89   Dec-10-11 11:05 AM   #70 
                    - Salary Cap  mick063   Dec-10-11 11:15 AM   #71 
                       - Couldn't have said it better  Aerows   Dec-10-11 12:36 PM   #89 
  - If it ain't broke, you don't fix it.  quaker bill   Dec-09-11 04:52 PM   #38 
  - Give them flexibility to do more things down the road as the economy improves/changes.  DCBob   Dec-09-11 04:56 PM   #40 
  - Cash reserves used to be important before credit got so easy and cheap.  SmileyRose   Dec-09-11 05:12 PM   #44 
  - Have to look at BOTH sides of the balance sheet  econoclast   Dec-09-11 05:30 PM   #46 
  - Capital strike. They are under orders to create no new jobs. Seriously. Google it.  McCamy Taylor   Dec-09-11 06:22 PM   #49 
  - Under orders? Don't think so.  hack89   Dec-09-11 08:03 PM   #57 
  - Believe it or not, its pretty simple to understand....  Xolodno   Dec-09-11 06:34 PM   #51 
  - +1  gulliver   Dec-09-11 08:05 PM   #58 
  - I think their excessive liquidity should be taxed, no matter where they keep it. nt  Ilsa   Dec-09-11 08:13 PM   #60 
  - How much is excessive?  hack89   Dec-10-11 09:25 AM   #63 
  - We have a deficit  Aerows   Dec-10-11 12:27 PM   #85 
  - So change the corporate tax laws - what does that have to do with how much cash they hold? nt  hack89   Dec-10-11 12:40 PM   #91 
     - That means they have to pay taxes for a change  Aerows   Dec-10-11 12:46 PM   #94 
  - And another thing  Aerows   Dec-10-11 12:32 PM   #86 
     - So if keeping people employed is all that is necessary to keep the economy humming along  hack89   Dec-10-11 12:43 PM   #92 
        - Manipulation of balance sheets  Aerows   Dec-10-11 12:49 PM   #96 
        - Every company I have worked for made profits by expansion  hack89   Dec-10-11 01:16 PM   #100 
           - You obviously didn't undergo the "effeciency experts" era  Aerows   Dec-10-11 01:37 PM   #102 
        - I notice  Aerows   Dec-10-11 01:08 PM   #98 
           - They should be taxed. Never said they shouldn't be. nt  hack89   Dec-10-11 01:14 PM   #99 
              - Why offer excuses then when they get subsidies?  Aerows   Dec-10-11 02:00 PM   #105 
                 - And yeah  Aerows   Dec-10-11 02:06 PM   #106 
  - Horrible idea, but at least horrible in a humorous way  Yo_Mama   Dec-10-11 04:25 PM   #123 
  - Well, they have huge loans and mostly slimmer margins. They need cash.  Yo_Mama   Dec-09-11 08:16 PM   #61 
  - No, many companies are hoarding cash  Aerows   Dec-10-11 12:59 PM   #97 
  - I didn't argue for cutting food stamps.  Yo_Mama   Dec-10-11 03:04 PM   #109 
     - Step up to the plate then  Aerows   Dec-10-11 03:11 PM   #110 
     - No, because I don't believe low-income people shouldn't get food stamps  Yo_Mama   Dec-10-11 03:30 PM   #114 
        - A. I have a company  Aerows   Dec-10-11 03:44 PM   #117 
           - You're making no sense  Yo_Mama   Dec-10-11 04:08 PM   #119 
              - I made a hell of a lot of sense to anyone that runs a business  Aerows   Dec-10-11 04:14 PM   #122 
              - Oh wait  Aerows   Dec-10-11 04:28 PM   #124 
     - Poison the well  Aerows   Dec-10-11 03:20 PM   #113 
  - Because people living on the thin ledge  Aerows   Dec-10-11 04:11 PM   #120 
  - More assets to play around with.  Rex   Dec-10-11 11:03 AM   #69 
  - Is that a serious question?  T S Justly   Dec-10-11 11:38 AM   #73 
  - Because most of them didn't have enough cash during the financial crisis.  JoePhilly   Dec-10-11 11:48 AM   #79 
  - Yes, and regular people holding on to their money  Yo_Mama   Dec-10-11 03:17 PM   #112 
     - Thanks much ... and I agree with your addition ...  JoePhilly   Dec-10-11 03:31 PM   #115 
        - Yes, it will be.  Yo_Mama   Dec-10-11 04:13 PM   #121 
           - I hear you ... and you remind me of this ... in the late 80s early 90s ...  JoePhilly   Dec-10-11 08:08 PM   #128 
  - Because they have little incentive to spend and can use their hoards to snap up  TheKentuckian   Dec-10-11 12:17 PM   #82 
  - Inflation is very very low almost to the point of deflation  BootinUp   Dec-10-11 12:23 PM   #84 
  - inflation will skyrocket.  mick063   Dec-10-11 03:16 PM   #111 
     - if political dysfunction prevents proper actions, anything is possible  BootinUp   Dec-10-11 03:48 PM   #118 
  - It's called "Citizens United"  Tsiyu   Dec-10-11 12:34 PM   #87 
  - they're greedy and that's all they know how to do  Blue_Tires   Dec-10-11 01:41 PM   #104 
  - if people couldn't do business  Aerows   Dec-10-11 02:24 PM   #107 
  - business  Locrian   Dec-10-11 06:17 PM   #127 
  - Right now they consider it more profitable to hold the money in bonds...  JackRiddler   Dec-10-11 08:40 PM   #129 
 

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