SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : Amazon.com, Inc. (AMZN)
AMZN 234.70-1.2%Nov 14 3:59 PM EST
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: Alomex who wrote (118889)2/28/2001 6:45:02 PM
From: Glenn D. Rudolph  Read Replies (2) of 164684
 
A recent news article posted here pointed out the possibility that arbitrageurs have been buying AMZN debt as well as shorting the stock. Then they will agree to convert the debt into stock aft 40-50 cents on the dollar and make a mint. This is another way for Amazon to retire debt. It would be dilutive, but not terribly so above and beyond the shorting that has already taken place...


Alomex,

I agree but there is too much focus here on the debt. The debt likely can be handled via a variety of possibly means. The problem really is in my opinion, the leases on the distribution centers. My premise for years has been that the cost of fulfillment will always exceed gross margins. Actually, if we really used GAAP, fulfillment would be included in the cost of goods sold so we would negative margins from square one. The only solution is if Amazon's customers will be willing to spend more for their products, plus shipping for the conveneience of shopping from home. There are people willing to do that. I am but not at Amazon but that is due to my dislike of the firm. There are not enough main stream people willing to do this so the distribution center leases make the current model impossible to be profitable. That is my position on Amazon.

Glenn
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News