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drjohn

10/27/08 6:25 AM

#70181 RE: mas #70180

RE: in the long run INTC/AMD are safe.

In the long run companies that can be profitable and offer positive returns to shareholders in the form of dividends and share price appreciation are safe. And they must be able to do so without acquiring massive amounts of debt or being highly levaraged. The take home message of the current crisis is that debt and leverage are in many ways similar and interchangeable, some smart economist/mathematician will probably win the noble prize in economics for clearly explaining the relationship. I think INTC is safe, AMD is way too highly indebted and leveraged to be considered safe.