Re:Google Launches Mortgage Shopping Tool in California
by tosseraccount on Monday November 23, 2015 @09:10PM
(#10618730)
Tesla bonds considered junk bonds ...
https://encrypted.google.com/search?hl=en&q=tesla%20bond%20r...
Re:Google Launches Mortgage Shopping Tool in California
by MichaelBurge on Monday November 23, 2015 @09:50PM
(#10618879)
Junk bonds sound more negative than they are. It just means they aren't a nation-state or a decades-old multi-billion dollar company, so there is more risk of default.
But bondholders get priority over stockholders the same way preferred stockholders get priority over common stockholders. And as a result, it's less risky to buy bonds than to buy the company stock, since they could at least pawn off the factories and cars if the company has to be sold off.
A quick Google search shows a market cap of 28 billion, and outstanding bonds worth 1.2 billion. So it seems unlikely to me that the company would be unable to be sold off for 1.2 billion to cover the bonds.
TL;DR: Tesla is the kind of lendee you want to have more of - uses the money for real R&D, pays loans down quickly and in full, gives back lots of value to economy. It's basically the textbook case of what those loans were made available for in the first place. It's the one company that you shouldn't be complaining about.
Government is giving free money that could be used to bring ideas to market faster; why should Musk not take it?