Apple issues $8B bond sale as debt market nears all-time low

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  • Reply 21 of 23
    65026502 Posts: 380member
    apple ][ said:
    I know very little about bonds, but I admit that I don't understand fully how they work.

    Look at the interest rate for the 3 year note, it's 0.75%?

    So somebody who invests in that bond will only get 0.75% after parking their money for 3 years? Does that sound worthwhile?

    Why don't they just take their money and park it in a bank account or something that will grant them a lot higher interest rate than 0.75%?

    Institutions who have billions laying around to invest, why don't they just invest in AAPL stock and make a killing instead of a lousy 0.75% after tying up their money for many years?
    I think it is more for investors that have $10's of millions to invest (beyond FDIC limits), not your average investor. Even Ally's interest rates have decreased recently, it was over 2% not that long ago. Perhaps they have a short term use for that money (or it's in escrow) and don't want to take the risk by investing in a stock (3 yrs is not that long and the stock could easily be down 10% in that time).
  • Reply 22 of 23
    gatorguygatorguy Posts: 24,088member
    gatorguy said:
    So, not only is Apple stripping funds from the operation that could have been used to enhance, expand or protect it -- but borrowing money to do it.

    Totally foolish
    Totally irresponsible... 

    Instead of investing in the business and its products American companies are handing out free cash to the wealthy.
    George says: "No company"? ....

    LOL... That's where I stopped reading....   Where did I ever say the "No Company" that you quoted me as saying? 
    Those who have no point and no argument have to invent things to argue against.
    And you are quite right George, that was Rayz. My sincere apologies. Don't stop reading, it's still informative, and speaks to the comment you DID make. 
  • Reply 23 of 23
    GeorgeBMacGeorgeBMac Posts: 11,421member
    asdasd said:
    So, not only is Apple stripping funds from the operation that could have been used to enhance, expand or protect it -- but borrowing money to do it.

    Totally foolish
    Totally irresponsible
    Totally common in America

    This is an example of why America can no longer compete in the Global market place.   Instead of investing in the business and its products American companies are handing out free cash to the wealthy.

    This is not the kind of corporate management that made America the richest, most powerful country in the world.   Actually quite the opposite.

    It is also an example of the delusion that the American economy is the best ever:   Even prior to the Corona virus America's GDP chugged along at the same piddling 2% rate it has been at since the Great Recession.   But, due to stock buybacks (even the government borrowed a Trillion $ to fund them!) and artificially low interest rates the stock market has soared -- and foolish people take that as a sign of a strong economy.

    Smoke and mirrors only work till a good wind blows away the smoke.
    It's a major blow to supply side theory as well. A lot of people will tell you that the money has not disappeared here, but is in people's pension funds etc, the problem with that argument is the money is locked up and not doing much that is productive. 

    Yes, that's true....  Stock buybacks are an admission that the business is not worth investing in.

    Essentially that's what Warren Buffet said this week about America in general when he reported that, despite the low prices, he couldn't find anything he wanted to invest in.

    It is a sad commentary that when the country is drowning in excess cash from the Fed, stimuli, and the tax scam, even at near zero interest rates, cash is still more valuable than an American company.

    Let's blame China.


    edited May 2020
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