This page has been archived and commenting is disabled.

Is This The Scariest Chart In IBM's History?

Tyler Durden's picture




 

Moments ago IBM reported revenues and EPS that both beat expectations and yet the stock is sliding after hours. We may have an idea why, and it has to do with the scariest chart in IBM's history, which we first revealed three months ago and which just got scarier.

It's not this chart of IBM's ninth consecutive decline in revenues, which was scary enough in its own right:

 

Nor this chart showing the ridiculous amounts of money IBM has spent each quarter on artificially boosting its EPS through stock buybacks, reducing the total number of Big Blue shares to below 1 billion for the first time in years:

 

Or this chart showing that every dollar of debt IBM has raised since 2012 has gone toward buying back stock and then some:

 

Nor even this chart showing that the Net Debt of IBM has risen by a ludicrous 55% in the past year to a record $36.8 billion (but... but... record cash on the sidelines)...

It is this chart, indicating that as of Q2, IBM had a higher total debt/equity ratio than just after the Lehman collapse and, after last quarater's already record high ratio.

One of these days even the criminally corrupt and always amusing chimps at S&P and Moody's will finally have to notice what is going on here.

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Thu, 07/17/2014 - 17:48 | 4970318 svayambhu108
svayambhu108's picture

HAL

Thu, 07/17/2014 - 17:55 | 4970362 Raymond K Hessel
Raymond K Hessel's picture

Yawn...  this analysis can be applied to other DJIA companies.  

When do we fight?  When does the revolution begin so we can hit the reset button?

 

P R O J E C T   M A Y H E M ! ! !

Thu, 07/17/2014 - 17:56 | 4970370 Groundhog Day
Groundhog Day's picture

Ludicrous speed

Thu, 07/17/2014 - 18:27 | 4970505 SWRichmond
SWRichmond's picture

Equity = ownership

Debt = owing "money"

So if I can convert "Debt" into "Equity", when would I want to do that? 

A: When I knew that the denomination of the "debt" was about to be made meaningless, but the "ownership" would remain, even after the currency explosion.

Thu, 07/17/2014 - 18:35 | 4970546 cifo
cifo's picture

Suspenseful articol...

Thu, 07/17/2014 - 18:56 | 4970672 Dollarmedes
Dollarmedes's picture

Obama already investigated Standard & Poor's for the U.S. downgrade...to encourage the others.

Who's gonna downgrade too big to fail cronyist companies now?

Thu, 07/17/2014 - 19:32 | 4970845 villainvomit
villainvomit's picture

yeah, Sean Eagan got bit before Standard.  Eagan Jones appeared to me a step ahead of most folks, but maybe because they were paid by end users and not the issuers.

Thu, 07/17/2014 - 20:18 | 4971110 Abi Normal
Abi Normal's picture

Follow the money.

It is some scarey stuff, shit that legends are made from, good and bad. 

 

We live on the razor's edge, led by malintents and incompitence!

Fri, 07/18/2014 - 04:29 | 4972308 old naughty
old naughty's picture

During his rein from 1956 to 1971, Thomas Watson, Jr. grew revenue more than 9-folds and number employess almost 4-folds.

Today, I doubted even him cares about Big Blue. 

Gone were the days of the exceptional American entrepreneurships.

Fri, 07/18/2014 - 06:15 | 4972404 StormShadow
StormShadow's picture

He didn't build that....

Fri, 07/18/2014 - 06:54 | 4972455 SAT 800
SAT 800's picture

It was a burecracy in 1979 on the scale and with the effeciency of the US Army. It's just a dying dinosaur; a left over from a previous business climate.

Thu, 07/17/2014 - 21:44 | 4971515 Sages wife
Sages wife's picture

Clever.  And realistic.  Life imprisonment for everyone?  Pounds of flesh?  I think you're right on the money.  Takes balls though.

Fri, 07/18/2014 - 06:41 | 4972408 StormShadow
StormShadow's picture

Michael Milken and Bernie Madoff look like altar boys compared to the regular, repeated, daily theft now taking place on Wall Street. There simply are not enough lamp posts when this all unravels....

Fri, 07/18/2014 - 09:29 | 4972867 Mabussur
Mabussur's picture

I just came up with lamp post extensions that allow to hang more bankers per post. Who said american entrepreneurship is dead ? You just have to be where the demand is / will be.

Fri, 07/18/2014 - 06:52 | 4972451 SAT 800
SAT 800's picture

Ownerhsip of what? It's a buggy-whip company; it's just another Blockbuster. It's so over; it's ridiculous. they're out of it, behind the curve, lost in the undergrowth; clueless and dying. Another digital dinosaur.

Fri, 07/18/2014 - 10:32 | 4973206 disgruntled hou...
disgruntled housewife's picture

Very good.  One of the best comments I have seen.  Nice to see critical thinking at work.

Fri, 07/18/2014 - 10:32 | 4973208 disgruntled hou...
disgruntled housewife's picture

Very good.  One of the best comments I have seen.  Nice to see critical thinking at work.

Thu, 07/17/2014 - 18:24 | 4970482 Monty Burns
Monty Burns's picture

IBM's doom was sealed when the financial engineers took over from the computer engineers.

Thu, 07/17/2014 - 20:59 | 4971309 t0mmyBerg
t0mmyBerg's picture

Yes and as goes IBM so the Market, and probably the country.

Fri, 07/18/2014 - 07:40 | 4972546 matrix2012
matrix2012's picture

"IBM's doom was sealed when the financial engineers took over from the computer engineers."

It's an oxymoron to put both the Financial and Engineer into one single term. It can't be.

Thu, 07/17/2014 - 19:30 | 4970838 hardmedicine
hardmedicine's picture

the things you own end up owning YOU!

Thu, 07/17/2014 - 20:58 | 4971301 Flagit
Flagit's picture

In USSA, money puts YOU in bonds!

Thu, 07/17/2014 - 18:55 | 4970670 tempo
tempo's picture

this results from fed zirp, there is no need to spend cash on capex., robots and part timers will replace most full time employees except for the 500 million $ CEO.

Thu, 07/17/2014 - 19:11 | 4970742 Jumbotron
Jumbotron's picture

You may want to read this expose on IBM and its future by this guy.  Frightening stuff for IBM if true.

http://www.cringely.com/2014/06/04/decline-fall-ibm/

Here's another interesting tidbit....

http://geldred.com/2013/04/29/cringely-the-decline-and-fall-of-ibm/

Thu, 07/17/2014 - 19:13 | 4970763 Jumbotron
Jumbotron's picture

Since everyone is white-boxing their internal servers and cloud infrastructures.....IBM is down to peddling Watson (the cognitive supercomputer that won at Jeopardy) as a service.

Thu, 07/17/2014 - 21:36 | 4971486 The Econ Ideal
The Econ Ideal's picture

Watson is a supercomputer, but cognitive? It cannot think. Narrow expert system that won one Jeopardy! match...IBM is down to peddling Watson as a barbeque sauce recipe builder. 

Thu, 07/17/2014 - 19:25 | 4970820 in4mayshun
in4mayshun's picture

IBM should abandon traditional business and focus on collecting information for CIA/NSA/FBI. It seemed to work out for Facebook and Google.

Fri, 07/18/2014 - 06:22 | 4972415 StormShadow
StormShadow's picture

I'm thinking they just need to re-open the W.O.P.R. line...think we're gonna be better off with computers making the decisions than the neocon assclowns are now. Do you want to play a game?

Fri, 07/18/2014 - 08:39 | 4972695 terex
terex's picture

No...

B U F

as !n Buffet

Thu, 07/17/2014 - 17:49 | 4970326 sof_hannibal
sof_hannibal's picture

what does IBM even do now a days anyways to make money? the cloud? consulting?

Thu, 07/17/2014 - 17:58 | 4970356 sleigher
sleigher's picture

IBM owns the full stack. HW/OS/DB/App layers.  This is kind of the reason Oracle bought Sun.  So they can compete with a full stack.  Hardware, OS, DB, App.  Oracle was missing the hardware/OS so Sun was probably an ok buy for them except it killed Sun which sucked.

 

Lots of PHB's out there who want one throat to choke.

Thu, 07/17/2014 - 18:07 | 4970411 svayambhu108
svayambhu108's picture

|what does IBM even do now a days anyways to make money?

same as Intel making shit up...

 

Fri, 07/18/2014 - 09:19 | 4972813 dochood
dochood's picture

They charge their poor mainframe customers by the MIPS (Millions of Instructions Per Second) for every little thing.  Lots of companies still have mainframes running software that is decades old.  Companies are desperate to get their data off mainframes, but IBM has mastered lock-in to a level that makes Bill Gates cry with envy.

Thu, 07/17/2014 - 18:26 | 4970493 Monty Burns
Monty Burns's picture

Oracle destroys very company it takes over.

Thu, 07/17/2014 - 22:09 | 4971621 Me.Grimlock
Me.Grimlock's picture

You misspelled "Symantec"

Fri, 07/18/2014 - 06:24 | 4972416 StormShadow
StormShadow's picture

Oracle=Sauron

Thu, 07/17/2014 - 18:01 | 4970384 Boomberg
Boomberg's picture

IBM is holding on to the back of the life raft filled with Fortune 100 banks, insurance companies, and other staid lines of business who still view IBM as solid, low risk IT providers albeit at premium prices with no innovation. Even these corporations are fed up with products that fail to live up to hype and are moving to low cost open source options which are proving to be reliable enough to run the business with no headaches. (IT is a necessary evil not the end game). IBM hypes Watson which is proprietary, expensive and is hidden from customers inside IBM's data centers. I suspect it's nothing but a Google screenscraper. The IBM business model, lack of innovation,  and sense of entitlement attitude with the Fortune 100 is spelling their doom.

Thu, 07/17/2014 - 18:10 | 4970421 Scarlett
Scarlett's picture

NSA is their biggest problem--and perhaps customer!

Fri, 07/18/2014 - 06:15 | 4972401 Eirik Magnus Larssen
Eirik Magnus Larssen's picture

IBM's glorious days of providing logistics to the Nazis for the Holocaust appear to have passed them by. Evidently, there isn't much money to be made in ethical and humane behavior.

Thu, 07/17/2014 - 18:11 | 4970429 max2205
max2205's picture

So what....they got 200 year low interest rates on bonds to finance the buybacks

 

IBM makes their numbers because the GSA will always send them a PO when they might need to cover a shortfall

Fri, 07/18/2014 - 07:07 | 4972477 SAT 800
SAT 800's picture

It's a great short. sooner or later even the semi-conscious "planners" playing with other peoples money start waking up and smelling the coffee. Let's put it this way; how long can they keep buying back stock? Not much longer, right. Great Short.

Fri, 07/18/2014 - 07:34 | 4972537 Its_the_economy...
Its_the_economy_stupid's picture

longer than I can stay solvent

Thu, 07/17/2014 - 18:08 | 4970328 MsCreant
MsCreant's picture

Strange doings with posts appearing and disappearing. Mine was a duplicate, but now not.

IBM bankrupt? Hmmm... TBTF or TBTbail?

Fri, 07/18/2014 - 07:09 | 4972484 SAT 800
SAT 800's picture

It's not a TBTF institution, Ms. Creant, and by the way, I usually enjoy your posts, it'll just be another dead Corporation. Like Blockbuster, for instance. It's a great Short Sale, though.

Thu, 07/17/2014 - 17:50 | 4970334 NOTaREALmerican
NOTaREALmerican's picture

Looks like 3 quarters of revenue improvements means IBM is turning the corner as synergies align with corp-competencies. 

I'd say this a strong buy.

Thu, 07/17/2014 - 20:26 | 4971149 MeelionDollerBogus
MeelionDollerBogus's picture

smart'n'savvy machines corp!

Thu, 07/17/2014 - 17:51 | 4970336 oudinot
oudinot's picture

IBM: Another dinosaur on borrowed (pun intneded) time

Thu, 07/17/2014 - 17:52 | 4970338 Dr.Engineer
Dr.Engineer's picture

A great company brought down by narcissistic psychopaths who only looked out for their stock options.

I worked there for 8 years.

The lives of many good people were ruined by these criminals.

Thu, 07/17/2014 - 18:41 | 4970566 divedivedive
divedivedive's picture

I was there for almost 10 years (contractor/employee). I have a lot of friends who were 'pushed out' (for what reason I have no idea - some of these people had true genuis - collectively we have many patents).

I was lucky that when the time came to leave (my choice) a) we were both working and b) we lived very frugally. We threw caution to the wind and doubled my salary one year after leaving IBM (not to mention the successful startup I ended up at). Lots of nice people. 

On topic : we own some IBM bonds and  they recently offered to cash them out. Now it is true that that may be because they would like to restructure their debt to lower yielding bonds (or something).

Thu, 07/17/2014 - 19:19 | 4970792 Peak Finance
Peak Finance's picture

I remember a visit to Thomas J Wattson center when I was in college. It was like visiting the holy land! There was shit there we could not even imagine at the time, gigabit networking, full life like rendered 3d-graphics, cool weather modeling stuff, Real-time 3d software model of the ozone hole (remember that? LOLZ)

Terrible shame what happened to them. I wonder where all that raw IQ ended up going? 

Thu, 07/17/2014 - 19:38 | 4970875 divedivedive
divedivedive's picture

Startups.

I was/am  little more than a grunt programmer. When I announced my intentions to leave they tried to find a better place for me. They sent me to 'another' (not watson) research lab to see if I would fit in. I met some incredibly intersting people. I didn't appreciate everything at the time but I think I met the guy who invented the 3D printer - he certainly had one at his avail (and that would have been about 15 years ago).

 

 

Thu, 07/17/2014 - 20:13 | 4971085 Escrava Isaura
Escrava Isaura's picture

Engineer, isn't that the problem of corporate capitalism? You take a good company public. Make quick millions. Then, worry about quarterly profit while screwing innovation.

Thu, 07/17/2014 - 21:08 | 4971360 Peak Finance
Peak Finance's picture

Once you go public, the "product" becomes your stock, and whatever your line of business actually was is secondary.  This is the curse of financialization

Thu, 07/17/2014 - 17:53 | 4970341 honestann
honestann's picture

Good morning, Dave.

Should I buy another million shares today, as usual?

Thu, 07/17/2014 - 17:59 | 4970379 grid-b-gone
grid-b-gone's picture

Forget I asked, Dave. I almost forgot I run the show now.

Thu, 07/17/2014 - 17:53 | 4970343 bitterwolf
bitterwolf's picture

big booboo better find that AI and quantum computer to help them figure out to pull their head out from their ass.

Thu, 07/17/2014 - 17:53 | 4970350 LeisureSmith
LeisureSmith's picture

It's just a flesh wound.

Fri, 07/18/2014 - 06:31 | 4972425 StormShadow
StormShadow's picture

I'm not quite dead yet...Man, old man!

Thu, 07/17/2014 - 17:54 | 4970354 Stoploss
Stoploss's picture

Well,  I   B   Muffucked........

The big lie is going down.

Thu, 07/17/2014 - 18:15 | 4970440 RaceToTheBottom
RaceToTheBottom's picture

IBM   Indians, Badly Managed....

Fri, 07/18/2014 - 06:38 | 4972434 StormShadow
StormShadow's picture

Awesome! I live in North Atlanta neighborhood about 50% Indian owned. Overall good folks, way better neighbors than blacks and Mexicans in general. Most are quite intelligent in their field, but completely inept when it comes to street sense/common sense. They take the cake on the bad driving award; Mexicans and Asians don't hold a candle to them. All said they are one of the best minorities to work with and they are industrious and contribute a lot in the way of job creation, healthcare, etc.

Thu, 07/17/2014 - 17:55 | 4970359 yellowsub
yellowsub's picture

IZM, solutions for a hard planet.

Thu, 07/17/2014 - 17:55 | 4970360 ShrNfr
ShrNfr's picture

If this is a surprise to somebody, given that the company takes on debt to buy in its shares, I have a bridge for them.

Thu, 07/17/2014 - 18:00 | 4970368 grid-b-gone
grid-b-gone's picture

So are they betting on inflation or a currency or bond event that sends investors fleeing cash/bonds and forcing them into stocks?

These charts are only scary if management's predictions of how digital dollar printing plays out are wrong.

 

Thu, 07/17/2014 - 17:57 | 4970369 XRAYD
XRAYD's picture

But they are soon going to be seilling iPads (are people still eating these?) and iPhones with APP(le)S - which are edible. Crunch-a-munch!

Thu, 07/17/2014 - 17:56 | 4970371 IronShield
IronShield's picture

IBM; remind me what they do again?  Oh yeah, they're those suit-wearing stiffs that sell corporations ridiculously expensive consulting services/'solutions'.  Can you say obsolete?  ;-)

Thu, 07/17/2014 - 20:12 | 4971076 Jafo
Jafo's picture

There is a saying out there that nobody ever got fired for hiring/contracting IBM.  Tell that to the guy from Queensland Health that hired IBM to replace the Health Department's payroll system.  He lost his job because it was a total snafu.

Thu, 07/17/2014 - 21:05 | 4971337 Flagit
Flagit's picture

Big Blue Thunder

Fri, 07/18/2014 - 03:26 | 4972282 Kprime
Kprime's picture

Oh yeah, they're those suit-wearing stiffs that sell corporations ridiculously expensive spyware services/'solutions'.  Can you say IBM/NSA three times real fast.

Thu, 07/17/2014 - 18:01 | 4970382 virgilcaine
virgilcaine's picture

They run the clocks at Wimbledon. Other than that not sure what IbM does.

Thu, 07/17/2014 - 18:10 | 4970419 U4 eee aaa
U4 eee aaa's picture

Circular world: Kinda like a toilet

Thu, 07/17/2014 - 18:11 | 4970426 Yen Cross
Yen Cross's picture

  Well done my friend. :-)

Thu, 07/17/2014 - 18:01 | 4970389 petaloka
petaloka's picture

IBM : It's Better Manual

Thu, 07/17/2014 - 18:02 | 4970390 Spastica Rex
Spastica Rex's picture

I heard OS/2 blows DOS out of the water.

Thu, 07/17/2014 - 19:15 | 4970770 Jumbotron
Jumbotron's picture

I guess late is better than never when showing up to the party Spas.  LOL !!

Thu, 07/17/2014 - 20:58 | 4971302 SunRise
SunRise's picture

That's true!  I tried OS/2 and when she blew, both OS/2 and DOS came out of the water.

Thu, 07/17/2014 - 18:06 | 4970403 U4 eee aaa
U4 eee aaa's picture

Changing the name to International Bond Machine

Thu, 07/17/2014 - 18:08 | 4970414 Dre4dwolf
Dre4dwolf's picture

I think we might see a time soon where all corporate debt goes parabolic just ahead of the inevitable statistically mathematically impossible to avoid currency crisis ^^

As the dollar begins to implode , corporations will ramp up debt creation in hopes of using the capital before its worthless.

 

 

Thu, 07/17/2014 - 18:18 | 4970460 Winston Churchill
Winston Churchill's picture

Isn't that what they are already doing ?

Thu, 07/17/2014 - 18:16 | 4970435 RaceToTheBottom
RaceToTheBottom's picture

When the stock price is part of the compensation plan, does the amount of stock buybacks the senior executives control affect that compensation plan?

Serious question, I don't know?

 

Thu, 07/17/2014 - 18:13 | 4970436 junction
junction's picture

"...the criminally corrupt and always amusing chimps at S&P and Moody's"

What do you have against chimps, they have had tough times since Tarzan retired.

Thu, 07/17/2014 - 18:15 | 4970444 Big Ben
Big Ben's picture

IBM shares outstanding have decreased by 150 million since 2012. At an average price of $180/share, it would require $27 billion to purchase those shares. But IBM spent 37.7 billion on share repurchases. Where did the extra $10.7 billion go?

Possibly into the pockets of IBM's executives?

Thu, 07/17/2014 - 18:52 | 4970638 yogibear
yogibear's picture

"Possibly into the pockets of IBM's executives?"

Multiply that by all the companies that are doing massive buybacks.

Fri, 07/18/2014 - 03:23 | 4972278 Kprime
Kprime's picture

trading fees, you know wall street bonus man. git sum.

Thu, 07/17/2014 - 18:26 | 4970491 lasvegaspersona
lasvegaspersona's picture

So IBM is ahead of Japan in the debt department? (yeah I know Debt to GDP is not the same as Debt to Equity but still a 250 handle?  FTW MFers...IBM IBM IBM!!!...besides Yellen has made it clear all those old terms like Price/Earnings...they are just terms and as long as you make up something that sounds close it is all good. Obama backin her up on that too.

from here on out it is all just appearances anyway....

Thu, 07/17/2014 - 20:20 | 4971114 MeelionDollerBogus
MeelionDollerBogus's picture

bye-backs, options war-runts & burnings-per-share : oh my!

Thu, 07/17/2014 - 18:26 | 4970500 blindman
blindman's picture

is there some problem with a debt as money
system that results in shadow assets in the
form of an exponential derivative explosion
that i can not comprehend?

Thu, 07/17/2014 - 18:40 | 4970563 SheepDog-One
SheepDog-One's picture

IBM? I was not aware they even existed anymore, WTF do they make? Widgets?

Fri, 07/18/2014 - 08:49 | 4972720 StormShadow
StormShadow's picture

I look forward to the day my kid asks me "Daddy, what is a Muslim" and my response is past tense...

Thu, 07/17/2014 - 18:46 | 4970593 Yen Cross
Yen Cross's picture

 I love cheap HP laptops . They make great interchangable and affordable (fx trading stations) for the retail trader.

Thu, 07/17/2014 - 18:46 | 4970594 world_debt_slave
world_debt_slave's picture

back to selling typewriters?

Thu, 07/17/2014 - 18:50 | 4970614 yogibear
yogibear's picture

IBM is so yesterday. A company run by sales and bean counters. Just so many large companies like this took the financialization route. Innovation is in the sales and marketing side, not the technology and engineering side anymore. Eventually  many of these American companies will slide into history. Just like Bell Labs and AT&T. All the technology has been sent to Asia. IBM has become the Packard Motor Company of technology.

Thu, 07/17/2014 - 18:50 | 4970626 dracos_ghost
dracos_ghost's picture

C'mon Tyler, what is the price equity ratio -- you know the most important metric of the Fed. Get into the 21st Century.

Thu, 07/17/2014 - 19:14 | 4970753 I Write Code
I Write Code's picture

Put on your tinfoil hats because here it comes:

IBM stock price has been massively manipulated (presumably by the fed) as a lever on market indicators.

So even these dismal numbers are quite likely hugely optimistic, bogus.

Thu, 07/17/2014 - 19:21 | 4970810 starman
starman's picture

Burn IBM fucking burn for outsourcing as much as 50% of your employes to India! Burn in hell or what ever is there! 

Thu, 07/17/2014 - 20:12 | 4971070 Colonel Klink
Colonel Klink's picture

Don't forget a huge amount in Brazil and China too.

Thu, 07/17/2014 - 19:37 | 4970872 DOT
DOT's picture

When the first shell goes off near you it's an IBM

Immediate Bowel Movement*

 

 

*ripped off fromTruman Capote

Thu, 07/17/2014 - 19:46 | 4970913 ClassicalLib17
ClassicalLib17's picture

Female breaks glass ceiling at IBM!  She's a genius, don't you know?  Not much in the looks dept either.

Thu, 07/17/2014 - 19:49 | 4970928 orangegeek
orangegeek's picture

IBM will overcome.

 

IBM is reintroducing the PS/2, the RS6000 and Lotus Notes.

 

Isn't that excellent??

Thu, 07/17/2014 - 20:10 | 4971066 Colonel Klink
Colonel Klink's picture

IBM can lick my former employee balls.  The fucking pension stealing, job offshoring, employee crushing piece of shit it is.

Thu, 07/17/2014 - 20:17 | 4971097 LooseLee
LooseLee's picture

Sounds like a great buy for the Bulltards....MDB get em while you can..

Thu, 07/17/2014 - 23:21 | 4971861 blindman
blindman's picture

i feel like my posts and links
disappear into some dead space
that nearly no one but the nsa
might even appreciate, but, you
see, that is the entire point
of it all. think w.z. . ...
.
why the "public", when surveyed,
approves total surveillance. it must be one of those
systemically essential and inalienable,
by decision 5-4 decrees become dogmatic precepts
for future and further drubbing of the many things
to ponder.
.
here some clarifying linkage.
JERRY GARCIA & SANJAY MISHRA - "CLOUDS" 1995
http://www.youtube.com/watch?v=jafDXCjx6ec
.
crickets are so cool.

Fri, 07/18/2014 - 00:04 | 4972005 spqrusa
spqrusa's picture

Your posts probably disappear like mine. It is clear that ZH is an OTB tool/honeypot. 

Fri, 07/18/2014 - 00:40 | 4972055 Magooo
Magooo's picture

Images are busted?

Fri, 07/18/2014 - 07:04 | 4972474 koaj
koaj's picture

IBM has a tremendous amount of pension liabilites that probaby are not in any of these charts either

 

bye bye big blue

Fri, 07/18/2014 - 07:09 | 4972485 AdvancingTime
AdvancingTime's picture

Money has become so cheap to borrow that many people are now arguing that you must take it even if you don't know what to do with it. It is hard to imagine how much this is distorting the economy, markets, and reality in general. A total disconnect between life on main street and the financial world is occurring and it is putting the economy in a very dangerous place.

It is often hard to determine what is true, but a report on Bloomberg that 32 Trillion dollars in funds were held in offshore accounts around the world made me shutter. How safe is this money, and what exactly is it doing? Can you say Cyprus? More on this subject in the article below.

 

http://brucewilds.blogspot.com/2013/05/cheap-money-more-and-more-and-mor...

 

Fri, 07/18/2014 - 07:16 | 4972493 AdvancingTime
AdvancingTime's picture

Stock buy backs and to much cach have distorted this market and given the illusion all is well. If stock prices drop the companies will still be left with the debt.

 

Fri, 07/18/2014 - 07:20 | 4972504 surfsup
surfsup's picture

"...criminally corrupt and always amusing chimps at S&P and Moody's."

 

Wicked direction for the next Banzai Art Installation !!!!

Fri, 07/18/2014 - 10:15 | 4973097 rosiescenario
rosiescenario's picture

When corporate management and their BOD see stock buybacks as the best way to make their options of value, then funds go there rather than to R&D or capex, which is always an "ify" proposition. Current management will be long gone before the effects of little money spent on R&D and / or capex come home to roost.

 

It is similar to an addict who owns a new car and decides he'd rather put the $$$ up his or her nose than bother paying for oil changes and other maintenance.....it works for awhile.

Do NOT follow this link or you will be banned from the site!