My point is, it isn't really accurate to put junk bonds into the category "cash + equivalents". Junk bonds offer the potential (but by no means the certainty) of higher returns, but, as is always the case, this comes with higher risk as well. To focus on the (potential) higher returns, while ignoring the (potential) risk, is to make the same mistake QCOM management has made over and over: taking too many risks, (and later, all too often, losing those expensive bets on investments). How can you still trust them in this area, when their track record is so poor?
When a company is young, and owns a young and unproven technology, it must take this degree of risk, to ProveTheirConcept. At this point, however, QCOM shouldn't need to. Maybe what is needed, is to replace the Visionary in charge, with an Accountant. Someone who, when he sees a proposal come across his desk, to gamble their cash reserves on junk bonds, responds by saying, "No. This is an unnecessary risk." A statement that present management never seems to say, about anything. |
