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    baynaam's Avatar
    baynaam Posts: 1, Reputation: 1
    New Member
    		  
    #1

    Jan 29, 2016, 09:13 AM
    What is the relation between stock market and capital expenditure?
    Hi there, today BoJ had cut its interest rate to -0.1%. I read various articles on this topic, however, one line that I read did not made sense to me. It was:
    “Some board members of BoJ are reported to have voiced concern that slumping Tokyo stocks could threaten attempts to get firms to boost capital expenditure.”
    My question is how could a declining stock market could trigger capital expenditure by firms? What is the relation between both of them?
    Anxiously waiting for a prompt reply
    Bye.
    Curlyben's Avatar
    Curlyben Posts: 18,514, Reputation: 1860
    BossMan
    		  
    #2

    Jan 29, 2016, 09:28 AM
    What do YOU think ?
    While we're happy to HELP we wont do all the work for you.
    Show us what you have done and where you are having problems..
    ma0641's Avatar
    ma0641 Posts: 15,675, Reputation: 1012
    Uber Member
    		  
    #3

    Jan 29, 2016, 08:51 PM
    Lets say you hold 1,000,00 shares of a $20 stock. Now, it drops to $18. How much have you lost? Not knowing the future, are you ready to use your stock to fund a project? What happens if the stock drops another $5?
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