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If TSMC is Taiwan Semiconductor it doesn't seem a good example: they have in their balance sheet $35bn (more than half of total assets) classified as "property,
by kgwgk 7y ago
If TSMC is Taiwan Semiconductor it doesn't seem a good example: they have in their balance sheet $35bn (more than half of total assets) classified as "property, plant and equipment" and their financial assets are just one tenth of that.
- robocat 7y agoBook value. If you tried to sell the property, plant and equipment (without staff) then the market value would be a lot less. The plant is almost a sunken cost (e.g. 10nm plant for Intel is a sunken cost). The current market cap of TSMC is 210B - related to the value of its future expected earnings compared with other companies.
- kgwgk 7y agoYes, book value. You said “The __book value__ of large businesses often contains so many instruments or contracts marked to market, that the __book value__ is largely dependent on market value in disguise.” I thought TSMC was supposed to be an example of that, but its assets are cash and old-fashioned capital equipment mostly. Even goodwill is minimal.