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SpaceX bond worth 10% less than issue price – heading for junk bond status

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Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#361

Post by wredcoll »

sebastiennight wrote: post #342
wredcoll wrote: post #299

Earlier quoted context omitted.

The term "capitalism" was literally only created for the purpose of writing criticisms of the (then) current system of markets/trading/taxing/investing. Try actually defining capitalism in a way that doesn't apply to basically any random society since the dawn of agriculture. Stuff like people buying and selling items using a currency for a price the individual chooses has been common to basically every human society…

> Try actually defining capitalism in a way that doesn't apply to basically any random society since the dawn of agriculture. .. feudalism? Which, AFAIK, lasted much longer, and is just not the same thing?

History.com says:

> Feudalism is a term often used to describe the social, economic and political conditions that existed in Western Europe during the Middle Ages. At its core, it was a system in which a landowner, or lord, granted a piece of land called a fief to a subordinate known as a vassal. In return, the vassal pledged loyalty to the lord, providing labor, military service, payments—or a mix of these.

And then the next paragraph goes on to say that historians think this is way too simple to describe what real people were actually doing.

Either way, unless every single piece of property in the kingdom (including, like, plows and mill stones and spinning wheels) was granted by the king (or someone he had granted to) it seems like there's still a lot of room for buying/selling/investing.

I mean, it's an interesting answer but my basic point is that the "real world" is far too complex for a term like capitalism to be at all useful.

Even stuff like "free market", can a market be "free" if a government exists? What about monopolies? Etc etc.

I just want people to be more specific when they criticize systems!

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#362

Post by hightrix »

ImJamal wrote: post #86
danso wrote: post #54

Earlier quoted context omitted.

How often do companies issue a $25B bond the same month that they IPO?

[flagged]

If I found a random comment on this topic on reddit, didn't read the comment, and then just copy pasted it here, would you feel respected?

This is the same thing. Stop.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#363

Post by [deleted] »

threetonesun wrote: post #359
groundzeros2015 wrote: post #143

Earlier quoted context omitted.

Companies need to raise money for investment. Even Apple doesn’t have cash for all the things they want to do. Suppose they want to lease or buy a piece of real estate.

Apple has a giant pile of cash and the last time they issued bonds was to do a stock buyback so that might not be the best example, although there's a fairly small number of companies in their unique position.

[deleted]

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#364

Post by HPMOR »

bko wrote: post #350
tavavex wrote: post #137

Earlier quoted context omitted.

So, the inclusion rules are basically "these are the hard limits that specify which stocks are eligible, unless someone really big and lucrative comes along, in which case it's whatever and we'll just adjust the rules to make them eligible"?

I think the rules are there are hard limits unless a multi-trillion dollar company IPOs with a significant absolute float, in which case tracking the "market" obviously includes said company.

Yeah, this is correct. There are so many large multi-trillion dollar companies coming to IPO, which if your are passive index holder and you are trying to track the market it is correct for these companies to be included. And besides SPY has chosen not to fast track where QQQ has. It is a free market, and folks are free to NOT buy QQQ. So I'm not sure why this is a point of debate.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#365

Post by toast0 »

elbasti wrote: post #348

Here's what this means for SpaceX for those of you uninitiated in bond-math: 1. SpaceX issued long-term bonds whose coupon (ie, "interest rate") was 6.5%. 2. Those bonds are now trading for less than their face value. That means that if you buy one of those bonds on the secondary market, you will get a return (yield) of 7.387% (if the price of a bond goes down , but the coupon stays the same, the yield goes up ). 3.…

> 2. Those bonds are now trading for less than their face value. That means that if you buy one of those bonds on the secondary market, you will get a return (yield) of 7.387%

That's your return if you buy one of those bonds and the bond is paid on schedule. Presumably the market consensus is there's some risk that payment may arrive late or not at all since the yield to maturity has increased since issuance and not as a result of underlying interest rate changes.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#367

Post by wredcoll »

clickety_clack wrote: post #339
wredcoll wrote: post #318

Earlier quoted context omitted.

Yes, you can but does that ability benefit the population/nation/market as a whole?

Yes, because the guy buying your bananas is able to make banana-buying decisions for next week based on the price you give him. You’re not going to make up a silly low number because you actually have to buy the bananas yourself at some point, and you help price discovery because now that guy isn’t buying bananas at a higher price than someone is willing to sell them for.

Just as a thought experiment, would you say there are any (societal) negatives to the possibility of thr price of bananas (or the share price of spacex) being able to fluctuate wildly based on semi-abstract economic manipulations, like shorts and futures and such.

What I'm getting at is when does it go from investing, "I think this entity is going to take my money and use it to build a profitable factory that will then return to me a share of the profits", to just gambling "I think this stock price will change by the end of the day and I'm going to bet on it", and what are the positives and negatives of that?

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#368

Post by GuinansEyebrows »

qwerpy wrote: post #248
iamshs wrote: post #155

Earlier quoted context omitted.

Guy was doing Nazi salutes at Trump's inauguration. If he wanted support from normal people, he should have remained within normal political norms, not do Nazi salutes. I don't think it is normal to expect sympathy after that, people will be revolted and would want him to fail. They should not be judged for this opinion, it's pretty vanilla. Normal people still carry conscience, an innate justice system. Otherwise we…

The fact that people like you are still pushing the subjective salute thing as incontrovertible fact makes it hard to find any common ground. Serious people in the media, even the ones heavily biased against Elon, don’t harp on it the way online people do.

i do not want to find common ground with people who do nazi salutes or those who excuse them. i want consequences these people because they wish harm upon me or excuse those who wish harm upon me. there is no "center" with this subject; there never has been, because nazi behavior forces the binary.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#369

Post by atmosx »

danudey wrote: post #344
wredcoll wrote: post #299

Earlier quoted context omitted.

The term "capitalism" was literally only created for the purpose of writing criticisms of the (then) current system of markets/trading/taxing/investing. Try actually defining capitalism in a way that doesn't apply to basically any random society since the dawn of agriculture. Stuff like people buying and selling items using a currency for a price the individual chooses has been common to basically every human society…

Saw an interesting discussion on how capitalism has existed for as long as markets have existed, including ancient Greece, and how it inevitably leads to wealth inequality, monopolistic behavior, unsustainable resource extraction, and all the other negatives we see today. The only difference is that in Greece, all of these negatives would have been applied locally but now they're all being applied globally. Instead o…

Nah, Ancient Greece has nothing to do with today’s capitalism. It’s a dumb example and the parallels will fall down to a close inspection. Different world.

Re: SpaceX bond worth 10% less than issue price – heading for junk bond status

#370

Post by exhumet »

thewebguyd wrote: post #315
qeternity wrote: post #284

Earlier quoted context omitted.

Empirically this isn't true. However you feel about "true" capitalism vs socialism, countries underpinned by capitalism have prospered, even the socialist flavors (China, Scandinavia)...while the countries that have attempted pure socialism have all failed.

The problem with that logic is you're treating economic systems as if they all exist in a vacuum, and you're setting up a circular argument of if its successful its actually because capitalism, if it fails it must have been socialism. It completely ignores the decades of external hostility toward any nation that attempted to build a socialist economy. Almost every attempt has been met with near immediate intervention…

agreed. its almost like... we need a healthy mix of economic systems to prosper
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