> So buying $1B worth of gold should result in a decrease of market cap because the market will typically discount the future value of doing that (ie you should

> So buying $1B worth of gold should result in a decrease of market cap because the market will typically discount the future value of doing that (ie you should be able to find better growth opportunities). They bought the $1B worth of gold using $1B worth of cash. It's true that gold doesn't have future cash flows, but neither does a pile of cash. > Same goes for mergers - a merger is supposed to get you synergies that grow you more than you’d be able to accomplish by yourself. A merger not resulting in a stock bump means that the market doesn't think it's a smart merger. My point was that it doesn't mean that the market thinks that whatever you bought was worthless. If a company spent $1B on a worthless thing (By making a big pile of money, and setting it on fire), you'd expect its market cap to drop.