OASIS FORUM Post by the Golden Rule. GoldTent Oasis is not responsible for content or accuracy of posts. DYODD.

Have you noticed !

Posted by Ororeef @ 14:05 on July 22, 2014  

Stock Management like IBM last qtr got 93 % of its earnings from Financial Engineering .Borrowing 4 billion in last qtr alone and used it to buy back stock combining that with Flat revenue and FLAT Profits boosted earnings per Share  93 % of which was due to stock buy back alone !

In  2004 Ibm had 13 Bil of debt ,now its 37 Billion !  THis also artifically  boosts BONUSES given for getting earnings per share up !   Price Earnings is not telling a true story af the Financial condition ..you must look at Capital Ratios  TOTOL  Capital  to TOTOL DEBT , looks like its close to 1.74-1 and falling ..

It used to Be that 2.5 to 1 was considered OK ..Other big Corporations are getting in on the Bonus Party by doing the same thing..

the BALANCE Sheet tells the Story of modern Financial Engineering.  watch those debt ratios climb and be prepared to Get Outta DODGE .

What happins when 37 bil of IBM debt interest cost doubles overnight from 1% to 2%.

BTW that was exactly how Bill Clinton balanced the Country budgets ,Treasury Sec Robert Rubin  refinanced most of us debt from 30 years to less than1 year  to reduce interst costs and falsly made Clinton look like a hero,balancing the budget .Now what happins to BIG Corp Debt AND BIG GOvernment debt comes due in 30 days and RATE go from 1 to 2 % overnight !     Its going to make 2009 look like a Picnic ! Its not only going to be a GUBBERMENT BUST ,BUT BIG CORPORATE BUST at the same time !    If rates go up 1 % its all over…….


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Post by the Golden Rule. Oasis not responsible for content/accuracy of posts. DYODD.