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Improving Valuation in Markets

Comment: "If only Amazon had invested $6.5 billion in the U.S. market, we would have fewer good and decent American Citizens standing in line for food stamps".

My Response: Complicated. You need to thank India for allowing Amazon to invest. Why? Amazon's market cap of above $900b has priced the Indian exposure. The impact could be multiples in the valuation ~ $90b. Technically, Amazon is "shipping" $6.5b but investors are adding $90b to its market cap. That $90b goes to Americans and America, not Indians.

Let me give you a secret: the best time to buy shoes, shirts, belts, etc is the last week of every quarter because that is when SALES goes highest as companies try to meet sales target with discounts.

This is the game: ABC Company can do a sales discount of $10m ("wasting $10m") but that would help it meet store targets, beating Wall Street expectations. Magically, that $10m could help to add $200 million in a company's market cap because Wall Street looks at same store sales, not profits!

Amazon is doing America a great deal by investing in India because that money is returning more valuation to pension funds, hedge funds, etc which invested in Amazon.

More here.