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Technology Stocks : Internet Analysis - Discussion
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To: Chuzzlewit who wrote (56)2/2/1999 4:10:00 PM
From: Joe E.  Read Replies (1) of 419
 
On the R+D subject, I think R+D is a capital expenditure.
It is not a real estate investment, of course, so it has to be depreciated faster.

Same with marketing expenses, to some extent. I don't buy Coke because I just today saw an advertisement for it, it's those years of Coke working on my brain through the tube paying off. Ditto Amazon - Buy.com is cheaper, just to name one, and Borders.com has the same prices, but Amazon has the marketing investment made, and it is drawing the shoppers.

I think that accounts payable and accounts receivable changes have to be counted as cash flow changes, just as investments in inventory are. Adjustments can be made for erratic shifts in these things, but just as bricks and mortar stores HAVE to invest in inventory (partially financed by accounts payable)to expand, the internet stocks get to hold their customers' money and so reduce the capital they need.
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