That's... astounding. A lot of people are gonna be pissed to log into Etrade or whatever and find this waiting for them. Of course if they were smart investors they probably would have sold right before HD-DVD died.
The market is not stupid. I expect if you looked at Toshiba stock it would have been dipping for months in anticipation of this. If my memory serves me correctly, stock actually rose after they announced HD DVD was dead because the market knew the format was hanging around their neck like a dead albatross. Cutting the format loose means that investors don't expect these losses to continue.
More concern to the market would be Toshiba's ongoing operations such as chip production. They still have the potential impact future earnings and Toshiba will just have to ride it out just like the rest of the industry.
The market wasn't nearly as responsible for the recession as the credit rating agencies that kept bolstering the trustworthiness of failing lenders. In this case the market wasn't "stupid" so much as it was "tricked". You can be cynical about the market all you want, but they got shafted almost as badly as the folks who got sold bad loans backed by (once again) b.s. credit ratings.
And yes, in this context the market is actually not stupid enough to not have anticipated this from Toshiba ages ago when it was clear that HD-DVD was fighting a losing battle. Anyone who still has money in Toshiba deserves their losses.
Reader Comments (Page 1 of 1)
Zorque @ Apr 25th 2008 5:31AM
That's... astounding. A lot of people are gonna be pissed to log into Etrade or whatever and find this waiting for them. Of course if they were smart investors they probably would have sold right before HD-DVD died.
gad get @ Apr 25th 2008 5:47AM
Course, if they were really smart investors, they'd have just skipped investing in any of those involved in the high-def format war to begin with.
Esat Dedezade @ Apr 25th 2008 6:02AM
I concur with gad...get.
Although the biggest rewards come with the biggest risks, its a coin toss between how much you are willing to risk for how much gain.
DrXym @ Apr 25th 2008 6:55AM
The market is not stupid. I expect if you looked at Toshiba stock it would have been dipping for months in anticipation of this. If my memory serves me correctly, stock actually rose after they announced HD DVD was dead because the market knew the format was hanging around their neck like a dead albatross. Cutting the format loose means that investors don't expect these losses to continue.
More concern to the market would be Toshiba's ongoing operations such as chip production. They still have the potential impact future earnings and Toshiba will just have to ride it out just like the rest of the industry.
omf @ Apr 25th 2008 10:45AM
"The market is not stupid."
Ummm... have you been paying attention to what The Market has been up to the last few years?
http://en.wikipedia.org/wiki/Subprime_mortgage_financial_crisis
G Kabik @ Apr 30th 2008 4:30PM
@ omf
The market wasn't nearly as responsible for the recession as the credit rating agencies that kept bolstering the trustworthiness of failing lenders. In this case the market wasn't "stupid" so much as it was "tricked". You can be cynical about the market all you want, but they got shafted almost as badly as the folks who got sold bad loans backed by (once again) b.s. credit ratings.
And yes, in this context the market is actually not stupid enough to not have anticipated this from Toshiba ages ago when it was clear that HD-DVD was fighting a losing battle. Anyone who still has money in Toshiba deserves their losses.