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Dear madmarv,

Waves a white flag

Aiee! I don't understand the statements there at all...

Normally "cash used in investments" has to do with purchasing stores etc. and the Fool's definition of FCF to equity makes sense. But in the case of MSDW, financial instruments ARE their business. Certainly one must include in FCF changes in the value of the marketable securities...

One note though. I see what looks to me like a lot of repos (e.g. Securities sold under agreements to repurchase, net of securities purchased under agreements to resell). It is my understanding that these function essentially as a loan, though they look different on a balance sheet (securities are sold, with an obligation to repurchase them at a later date at a higher price, the securities themselves are the collateral for the loan).

Any comments y'all? The Fool's models don't seem to be as useful for finance companies, they work a bit different...

Lleweilun Smith
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