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Strategies & Market Trends : Value Investing
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To: Rainmaker888 who wrote (39383)9/22/2010 3:26:59 PM
From: Paul Senior2 Recommendations  Read Replies (1) of 78717
 
cash question: I'd say it depends on the company. For a growth company, I'd value lot of cash as a negative. That is, if they are growing why are they holding cash instead of reinvesting in the business or returning excess to shareholders?
For net-net companies, it's a positive. You'd be trying buying the stock to get $1 cash for fifty-cents.
For value investors, cash would be one margin-of-safety aspect. I assume though, that value investors are a minority, and that "the market" wouldn't value cash that highly.
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Is it something like this that's hurting this USA now?: Everybody afraid of something or another, so we have companies and individuals sitting on what - a $trillion in cash assets?

Maybe it isn't that the market doesn't value cash. It's that people don't value the market. Buying stocks is out of favor.
Too many people just holding on to their own cash...or trying to.
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