Company behind Snapchat allegedly absolved 100 people

By admin On Apr 2, 2018

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No, it has to do with sentiment. Holders of debt paper assume that when stocks are high, they can always issue shares to repay their debt. If the share falls, then the chance increases that a company that needs as much money as Tesla, has to issue bonds. More supply, price is falling. Current holders anticipate this by selling. Yes, to another. Someone who wants to run the risk for a higher fee. Namely the interest + extra piece for repayment.

In the case of Tesla, the bond market is currently closed to them. They can not pay more than 7.5%. Their margins are already negative. Shares for liquidity may not just (SEC), especially now that they have declared in their 10K that they do not need capital, because they get enough cash flow from Model 3.

Very simple, if you have more than $ 10 billion in long-term debt and a further $ 10 billion in short-term and contractual obligations and your cash is running out, and you can no longer attract capital, then the music stops. Or do you think suppliers continue to deliver in such a situation? They are already being bothered. They have reserved capacity but can not deliver. No idea how those contracts were concluded, but there is undoubtedly a penalty clause for both parties. Tesla has no positive cash flow, so it determines cash.

Up to now, Tesla has always had easy money because it was intended for capital investment. Ask for capital because you burned it, the production is still out of order and the only thing that grows considerably are the losses: 300% in a year. Requesting money for the lights to burn goes against very different conditions and of course there will be investors taking the risk. But I would not touch 2025 debts with a finger.