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Technology Stocks : How high will Microsoft fly? -- Ignore unavailable to you. Want to Upgrade?

To: Bearded One who wrote (33164)	11/8/1999 12:24:00 PM
From: Reginald Middleton	Respond to of 74651

Unfortunately, that is not the way it works in the real world. That 19 billion dollars is attached to MSFT's other assets. When you get a cash investment from MSFT, chances are you get access to technology, marketing, distribution, and management expertise as well. If we are going to play the game, we have to play it accurately. Create, Store, Access and Manipulate Microsoft Office compatible, web-centric documents anywhere, anytime, from practically any device absolutely free at nuomedia.com.

To: Bearded One who wrote (33164)	11/8/1999 1:37:00 PM
From: Michael Pogor	Respond to of 74651

It would be MORE than 19 Billion dollars, of course! The cost to replace that 19 Billion dollars would be more, because it would have to be borrowed or earned, which costs money! Also, the loss of 19 Billion dollars would represent the loss of opportunities to invest that money. Having that money means that MS can invest without incurring borrowing costs.

To: Bearded One who wrote (33164)	11/8/1999 2:22:00 PM
From: Gerald Walls	Read Replies (1) \| Respond to of 74651

I didn't ask what you would pay for 19 billion + a piece of Microsoft. Ok, I'll simplify it. Suppose Microsoft announced today that someone broke in and stole 19 billion dollars, and their insurance didn't cover it, and it was guaranteed to never happen again (and you believed the guarantee). What would be an appropriate drop in Microsoft's market cap? Suppose Microsoft announced today that someone broke and left 19 billion dollars, and that they didn't have to give it back, and it was guaranteed to never happen again (andyou believed the guarantee). What would be an appropriate rise in Microsoft's market cap? They're both ridiculous, BS questions, aren't they?

To: Bearded One who wrote (33164)	11/21/1999 7:52:00 AM
From: Bilow	Read Replies (3) \| Respond to of 74651

Hi Bearded One; With that post on the valuation of MSFT's cash, you have placed your finger precisely on the crux of the current stock market bubble. MSFT makes money. They can borrow money at will. If they suddenly lost or gained a billion dollars, their market cap should fall or rise by that same amount. But since they are MSFT, most investors currently apply a multiple greater than one to that pile of undistinguished money. On the other hand, they wouldn't apply that multiple to a pile of debt. I really believe that if MSFT borrowed $10 billion, and increased their money pile with it, the herd would bid the share price up, even though the company would pay out more interest than it would earn on the borrowing. If the company turned a billion dollars into plant and equipment, chairs, desks, and computer equipment, then investors could be right to value it at more than a billion dollars, but only if it were being used to make money. -- Carl