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I'm not against your idea, but your arguments are a little wobbly. > It is the growth companies who don't own factories yet, who are raising money today that g
by fennecfoxen 5y ago
I'm not against your idea, but your arguments are a little wobbly.
> It is the growth companies who don't own factories yet, who are raising money today that get hurt by inflation.
Yep. They, too, compete with opportunities like bonds and savings account.
> But the factory loans that Apple bought 5 or 10 years ago are in 2010 dollars and will remain so.
Lots of companies have issued bonds at very good interest rates. They're not mostly for factories. Apple's been borrowing money at rock-bottom rates to do share buybacks, because the money's basically-free.
> It is the growth companies who don't own factories yet, who are raising money today that get hurt by inflation.
So how many growth stocks are investing big into building massive manufacturing operations, Elon? I can think of around one, but certainly not Apple.
- dragontamer 5y agoModerna, Rivian, Peloton, Wework (not factories but buying up real estate), Intel, TSMC, ASML. Even things like Backblaze buy up hard drives and data centers to sell services to us in the future. Buying up thing to make more money later is the age old strategy. ------ Changing the balance of Growth vs Establishment is the biggest effect of inflation (and interest rates). Established companies like Intel can rely upon older factories if the new factory turns out to be a bad bet. Growth companies are 100% all in on future factories (or future equipment, like Backblaze).