Hacker News new | past | comments | ask | show | jobs | submit login

I wonder if Amazon is worried.



Google perhaps should be more worried than Amazon.

Alibaba is an advertising company, not a retailer.


They should be. Amazon makes no profits and operates in dollars. Those are two things you don't want to get caught doing right now.


The US Dollar has gained strength since the financial crisis of 2007/09, not lost strength. There is presently no real threat to the US Dollar reserve standard anywhere.

And in fact it just went on a record parabolic climb in the last few months. Amazon is helped by this effect, it makes it cheaper for them to import goods for sale in the US. Exporters are the ones harmed by a stronger dollar.


Amazon's profits are redeployed into investments.


That's Amazon's PR, yes.

http://www.cepr.net/index.php/blogs/beat-the-press/franklin-...

"The people who say that this is due to the fact that they are investing in building up their business are showing their ignorance. Reinvesting and profits are two separate issues. Profits reflect the difference between revenues and costs on current business operations. These can all be used for investment in expansion (as opposed to being paid out as dividends and share buybacks), but they should still show up as profits. Amazon doesn't show profits or at least not much. This means that it costs them as much to run their business as they are getting from customers in revenue. That is not viable as a long-term model even if they are always expanding."

-----

edit:

[from a comment on that page]

Title: "Nothing Depreciates In Less Than 5 Years"

"Sorry folks, there is no way that would keep Jeff Bezos out of jail where their greater investment would explain the lack of accounting profit. There is nothing that depreciates in less than 5 years (20 percent annual rate) and most items at a considerably faster rate. This means the difference in re-investment rates could at best knock off a small share of Amazon's profits if they are not committing fraud.

"The math on this is simple. Assume Amazon's 'true' profits are rising 15 percent a year. Assume that they re-invest 100 percent of their profits, as oppose to the 30-40 percent that would be more typical. The higher depreciation over the last five years in this case would account for just 47 percent of Amazon's current year profits. The number would fall sharply if we assume the true rate of profit growth is 20 percent or higher and that some of Amazon's investments depreciate in more than 5 years."


What is wrong with dollars?


I'm being downvoted to mean this is not the place to discuss this or I'm straying too far. If you want to know, read up on the Zero Hedge blog (I'm not affiliated, I'm just a reader, etc etc).

But basically what's wrong is Russia and China (so 1.5 billion people) plus the Middle East are all tired of the petrodollar and want out badly.




Guidelines | FAQ | Lists | API | Security | Legal | Apply to YC | Contact

Search: