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.

Politics : Foreign Affairs Discussion Group -- Ignore unavailable to you. Want to Upgrade?

To: Elroy who wrote (211979)	1/7/2007 4:28:16 AM
From: kumar	Respond to of 281500

HPQ (or HWP when I was more familiar with the company), may have debt of $5B. they own just in real estate property in the bay area about 4 times that much. "responsible debt" - capiche ?

To: Elroy who wrote (211979)	1/7/2007 8:46:36 AM
From: jttmab	Respond to of 281500

Good example. HPQ has $5.2 billion in debt as of their last quarterly report. Companies acquire debt in order to have growth and return higher profits to shareholders. The Federal Government doesn't make a profit nor does it intend to make a profit. Growth in Federal Government may be a necessity because of population growth but growth isn't a goal of Government unless your objective is a communist Government. Companies aren't all that keen on creating unfunded liabilities. Look at GM for an example of what happens when a company is stuck with large debt, no profits, and unfunded liabilities. The Federal Government on the other hand happily takes on unfunded liabilities such as social security and the idiotic Medicare prescription program. I really don't expect HP to start a program where they promise to give free ink cartridges to everyone that has an HP printer. Corporations also handle debt differently than the Federal Government. Corporations manage debt for their benefit and the benefit of shareholders. They roll over debt when it's to their financial benefit to do so, e.g., a lower interest rate. The Federal Government rolls over their debt to the prevailing interest rate, regardless of whether it's higher or lower. jttmab