This is why Apple took (takes) out billions of dollars in loans despite having nearly a $1 trillion market cap of which a significant portion is cash.
If you're a large corporation and have low-interest money offered to you, it's almost fiscally irresponsible not to take the loans.
Depends of the tax laws of your home country, of course, and I don't know anything about Japan. But in the US, if you were to get offered a 0.1% interest loan, take the money now and figure out what to do with it later.
Buffett and Munger have said that they are having difficulty investing cash because they have so much of it. In this case it seems irresponsible to take loans. I don't see the point unless it's a tax dodge.
For apple it was a tax dodge. A lot of the cash they had on hand was owned by offshore subsidiaries and if they moved it to U.S. company to pay out dividends or do a buyback that would trigger corporate taxation. So instead they borrowed against that cash hoping that the corporate tax rate would drop in the future and they could move the money and pay off the debt then.
I hear everyone saying this. It seems like 12-years of global QE is gonna cause a massive spike in inflation. Everyone's valuing things as if there's been hardly any inflation since 2007.
The reality is, there's 120% MORE narrow money (M1) today than there was in 2007. There's also 74% more board money (M3).
Has there ever been a long period (12 years, in this case) where we've had only ~25% inflation with ~120% growth in the money supply?
Naively, it seems like there's either too much money (not sure how you solve that) or everything is too cheap.
Well the main issue is all of this money is going to the wealthy. And while I don't have hard data to back this up, it feels like 'inflation' is rampant in the things that wealthy people throw money at, e.g. stock market, real estate, art, etc...
Buffett's subsidiaries still borrow money to build things like power stations and railways. He prefers to keep some cash so he can put it in high return ventures if they come up.
If you're a large corporation and have low-interest money offered to you, it's almost fiscally irresponsible not to take the loans.
Depends of the tax laws of your home country, of course, and I don't know anything about Japan. But in the US, if you were to get offered a 0.1% interest loan, take the money now and figure out what to do with it later.