Silicon Investor (SI) -- The First Internet Community

STOCKTALK

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 : IBM -- Ignore unavailable to you. Want to Upgrade?

To: Elroy who wrote (7708)	6/18/2002 11:22:29 AM
From: Charles Tutt	Respond to of 8218

It's hard to say. I might prefer the pure play. But I concede that's another way of looking at it. Charles Tutt (SM)

To: Elroy who wrote (7708)	6/18/2002 1:31:04 PM
From: Kirk ©	Respond to of 8218

RE Finance Business. Charles Tutt: "Given two companies identical except that one has billions in debt and the other is debt free, I'd take the one without the debt." Elroy: Well how about two identical companies in business operations, but one of them provides financing to its customers and makes 2% on the financing loans (after counting in defaults, credit risk, etc.), while the other does no financing. Wouldn't you want the same business + a nice financing business rather than the same business and no financing business? That is the question. I think my answer would depend on the quality of the loans. Cisco and HPQ wrote off many bad equipment loans to internet startups. I think they were taking equity in exchange for payment at the height of the bubble. GE or Visa might lend you $600 at 19% to buy a new fridge... one in 50 might default but they should still make money in the long run. Now if the loans are going to be repaid at above market rates, then the business is a good one. But I might argue I could find better use for the money building etchers and CMP cleaners for Copper wafers (ie buy some LRCX or AMAT stock). Kirk