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To: Skeeter Bug who wrote (39448)	10/1/1998 2:51:00 AM
From: Carl R.	Read Replies (2) \| Respond to of 53903

skeeter maybe one additional example might clear things up for you, a static company. Imagine a semi company with $1 billion in depreciation that makes $0 in profit. They need to invest $1b in new equipment each year to remain competitive, so they do. Every year the same thing happens. This company remains the same, no new cash is required or generated. Each year they have a $1 billion cash flow from operations (profit plus depreciation) which they turn around and invest in new equipment, leaving them with the same plant they started with and the same cash they started with. Carl