"My point has always been that the business converts capital...

"My point has always been that the business converts capital outlay into profits and dividends.

The laying out of capital in order to return profits and dividends is the most fundamental tenet of Capitalism.

It's what companies do. WES does it. BHP does it. CSL does it. ONT does it.

In fact, I cannot think of a single company that doesn't do it.
Can you name any that don't do it? Or can you name just one?


"But this is not sustainable for the long term."

It's not? Goodness!
Calling the end of the Capitalist way like you are doing is an almighty big call.

To know whether it is sustainable for the long term I think one can only draw on history which has this economic model being the go-to form of commerce for close to a thousand years.

I'm no expert at this kind of macroeconomic forecasting, but my bet is that the current form of Capitalism that "converts capital into profits and dividends" will be with us for at least the rest of my living days (and I'll go so far as to say for the living days of my children, too.)


"I submit that the goodwill values on the books is above its true worth."

Instead of mere sweeping statements of arbitrary and unsubstantiated opinion I can only rely on financial facts in forming a view of such things.

And the financial fact is that, with the existing level of goodwill, the company's Return on Capital Employed (ROCE) is currently 21%, and it has never been lower than 18% in any given financial period.

That level of ROCE is probably only enjoyed by the top quartile of publicly listed companies.

But advise us: To what level of Return on Capital Employed should the goodwill be written down? And, pray tell, why?