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Pastimes : The Naked Truth - Big Kahuna a Myth

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To: xstuckey who wrote (82882)1/8/2000 4:21:00 PM
From: KyrosL  Read Replies (2) of 86076
 
Issuing stock may not be an option -- their institutional holders will not view it favorably, and the stock will probably tank well before they manage to sell any. That's why last time Amazon needed money to fund their brick and mortar warehouses, they issued convertible debentures. The stock is well below the conversion price, and they have to pay lots of interest to their bondholders. This money will soon run out. I wonder what they will do then.

Meanwhile, the brick and mortars are learning -- slowly but surely. Wal-Mart is getting its web act together, with plenty of already built and ready warehouses to support web sales many times those of Amazon, and with much better economies of scale. And so does ToysRUs. Barnes and Noble seems to be doing OK too. etc. etc.

I agree the whole internet thing is a wonderful inflation fighter. In fact, I think it will turn out to be too good an inflation fighter and will cause some serious deflation down the road. One thing is sure: it caused a great deal of deflation to my bills in the last few years from charting services, to patent searches, to newspaper and magazine subscriptions, to telephone calls, etc. etc. and, of course, the bargains at Amazon and the other e-tailers.
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