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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Wyätt Gwyön who wrote (17823)	2/25/2004 12:02:03 PM
From: deeno	Read Replies (1) \| Respond to of 306849

I dont disagree with your conclusion but you can not take the magic of compounding and then divide it by the number of years, its dishonest. 30 yr strips would yield about 5.25% so the first year "profit" assuming no taxes would be 1.3125 billion. If you want to start your critique from here it would be more reflective of your concerns.

To: Wyätt Gwyön who wrote (17823)	2/25/2004 3:11:06 PM
From: Lizzie Tudor	Respond to of 306849

if you add up all the money spent on RND, and look at the economic return from it, the return is VERY poor. people misunderstand because they confuse market cap (investors' momentary assessment of value in a tech bubble) with the actual cash flows derived from the RND. Wait a minute.... what is the point you are trying to make, is it that Google's 25 billion dollar market cap is unjustified as a representation of the return from their R&D spending? If that is your argument I don't think anyone disagrees, and the public even knows it at this point. But to argue that Google's R&D investment isn't paying off big wrt their current cash flow in the hundreds of millions per year- thats another matter. Google's roi on R&D is NOT very poor. The disconnect is not the value of R&D spending to the company, it is the valuation the public puts on the stock which is a reflection of many things, not just R&D hype. The best example of R&D spending payoff that I can think of is Dell. The real magic of Dell is that they collect cash up front for every product they build. In order to do this seemingly simple implementation it cost hundreds of millions soup to nuts. A very high ROI nonetheless.