Apple Now Debt Free, Says Internal Memo

want confirmation? by Anonymous Coward · 2004-02-18 07:09 · Score: 5, Insightful

when's their next SEC filing deadline?

Re:want confirmation? by mal3 · 2004-02-18 07:19 · Score: 5, Funny

I doubt it's true. That bastard Jobs still owes me $5 from high school.

--
Non gratis rodentus anus
Re:want confirmation? by phil+reed · 2004-02-18 07:28 · Score: 5, Informative

From their latest 10-Q statement, dated Feb 10, 2004:

Debt

The Company currently has debt outstanding in the form of $300 million of aggregate principal amount 6.5% unsecured notes that were originally issued in 1994. The notes, which pay interest semiannually, were sold at 99.925% of par, for an effective yield to maturity of 6.51%. The notes, along with approximately $1.5 million of unamortized deferred gains on closed interest rate swaps, are due in February of 2004 and therefore have been classified as current debt as of December 27, 2003. The Company currently anticipates utilizing its existing cash balances to settle these notes when due.

Since they've got way more than $300 million in the bank, they would be able to cover these notes in cash, which is apparently what they did.

--

...phil
"For a list of the ways which technology has failed to improve our quality of life, press 3."
Re:want confirmation? by Anonymous Coward · 2004-02-18 07:51 · Score: 0

Yeah, good 'ol Homestead High school. I went there, but he doesn't owe me money...
Re:want confirmation? by sam1am · 2004-02-18 07:58 · Score: 4, Interesting

And just in time for Fred Anderson's Retirement from the position of Apple's CFO on June 1.

HUMANS do it better
Re:want confirmation? by IanBevan · 2004-02-18 08:08 · Score: 3, Funny

Am I the only person here that has absolutely no idea what any of that means ? It kind of lost me after '$300 million...'.

--
Never, ever lose a file again. Ever.
Re:want confirmation? by glitch! · 2004-02-18 08:15 · Score: 2, Offtopic

I doubt it's true. That bastard Jobs still owes me $5 from high school.
Dude, Lemonade Stand was just a game. A game :-) (Even if you did discover that you could raise the price to $1 million on a hot day and still sell one...)

--
A dingo ate my sig...
Re:want confirmation? by Gogo+Dodo · 2004-02-18 08:33 · Score: 5, Informative

Lets see if I can translate that...
Apple sold debt in 1994 that was due in February 2004 (10 year debt). For examples sake (and easy math), Apple said to bond holders: "Loan me $100,000 and I'll pay you 6.5% interest. On February 2004, I'll pay you back $100,000. However, instead of giving me $100,000, I'll let you give me $99,925 today (99.925% of par), but still give you back $100,000 in February 2004." The bond holder make the 6.5% interest and an extra $75. The "effective yield" is that 6.5% plus the $75.
The interest rate swaps are a little harder to explain. Essentially, Apple is covering themselves in case of large interest rate swings.
If you would like to read up on bond things, you might want to look at the Bond Market Association Publication list. Click the PDF links. The prices listed are for if you want a hard copy.
Re:want confirmation? by Loki_1929 · 2004-02-18 08:38 · Score: 0, Offtopic

" I doubt it's true. That bastard Jobs still owes me $5 from high school."

You should send him a registered letter informing him of the debt, which has been accruing interest at prime, up until today. From this day forward, you should inform him, the aforementioned debt shall accrue interest at prime^(prime^prime) per quarter, assessed hourly. That should get him on the ball for repaying the debt, or at least get him working on lowering the prime interest rate for the rest of us. Figure by the time the letter reachs him, it'll probably have already accrued more interest than the national debt of the entire US Federal government.

--
-- "Government is the great fiction through which everybody endeavors to live at the expense of everybody else."
Re:want confirmation? by BlaisePascal · 2004-02-18 08:40 · Score: 5, Informative

Sure.

A very common way of borrowing money in the corporate setting is by selling promissory notes ("notes"), or loan contracts. Like private loans, every note has associated with it a principle amount (how much was borrowed), an interest rate (how much extra the lender gets per annum for lending the money), and sometimes a security (what the lender gets if the borrower fails to live up to the terms of the notes).

Most notes are standardized in their particulars: The principle is usually $1000, the payment plan is usually interest payed quarterly or semiannually and the principle payed off in full at the end of a pre-defined period. The only variables of import are the length of the loan and the interest rate.

In this case, the notes in question have a lifetime of 10 years, and pay 6.50% interest semiannually. If you owned one of these notes you would get two checks a year of $32.50 each until now, when you would get a check for $1000. If you had bought it when originally sold by Apple, you would have paid $999.25 for it instead of $1000.

So what Apple is saying is that there were $300Mil of these notes (or 300,000 of them) still outstanding in February, and they planned to pay them off with cash on hand.
Re:want confirmation? by Zone5 · 2004-02-18 08:41 · Score: 1, Informative

Unless prime > 1 (which it never is), your prime^(prime^prime) calculation tends towards zero.

$5 just isn't going to pay off much debt, now is it?

Don't quit your dayjob. Unless you're in finance - then quit right away! :)

--
"So on one hand, honey is an amazingly sophisticated and efficient food source. On the other hand it's bee backwash."
Re:want confirmation? by pokeyburro · 2004-02-18 08:45 · Score: 1

Okay, when's your next SEC filing?

--
Lately democracy seems to be based on the skybox, the Happy Meal box, the X-box, and the idiot box.
Re:want confirmation? by DigiShaman · 2004-02-18 09:05 · Score: 1

Wow, you should be a rich man if you add in compound interest. *grin*

--
Life is not for the lazy.
Re:want confirmation? by Aqua+OS+X · 2004-02-18 09:31 · Score: 3, Funny

Jobs probably used that $5 to buy his first black T-shirt at Mervyn's in 1972.

--
"Things are more moderner than before- bigger, and yet smaller- it's computers-- San Dimas High School football RULES!"
Re:want confirmation? by Anonymous Coward · 2004-02-18 09:43 · Score: 0

You played Lemonade Stand in high school?

Don't you know all the cool kids were playing Oregon Trail.
Re:want confirmation? by Loki_1929 · 2004-02-18 10:02 · Score: 1, Offtopic

" Unless prime > 1 (which it never is), your prime^(prime^prime) calculation tends towards zero."

Wow, someone really ought to tell the Fed about this. Apparently, they seem to think that the prime rate is currently at 4.00%.

Slightly more research seems to indicate that the Fed has been wrong about the Prime rate since their creation. Historical lows as reported by the Board of Governors of the Federal Reserve System (which are obviously either wrong or lying as per your comment) appear to dip no lower than 1.5%, but do seem to go as high as 21%. Thank goodness we have you here to spot-check jokes for correct information and then provide appropriate misinformation.

"Don't quit your dayjob. Unless you're in finance - then quit right away! :)"

Yes, funny man, you've given 'irony' an entirely new meaning.

--
-- "Government is the great fiction through which everybody endeavors to live at the expense of everybody else."
Re:want confirmation? by Greedo · 2004-02-18 10:11 · Score: 2, Informative

Math lesson:

prime = 4% = 4/100 = 0.04 ... which is < 1

But thanks for the links to the historical data.

--
Tuus crepidae innexilis sunt.
Re:want confirmation? by jcr · 2004-02-18 10:12 · Score: 1

BTW, Mr. Anderson did say during Apple's last financial analysts' conference call that Apple would be retiring its debt in the near future...

--
The only title of honor that a tyrant can grant is "Enemy of the State."
Re:want confirmation? by Loki_1929 · 2004-02-18 10:24 · Score: 1

Hmm... that's what happens when you're out of school a decent number of years. :)

My thinking was at least semi-logical; the mistake owed to a bit of hurried posting from work and non-thinking. My bad ;)

--
-- "Government is the great fiction through which everybody endeavors to live at the expense of everybody else."
Re:want confirmation? by Richy_T · 2004-02-18 10:42 · Score: 1

Of course, that would have been surprising until the mid 90s when many found they could create a business with no business plan and receive millions in VC funding.
Rich
Re:want confirmation? by Moofie · 2004-02-18 11:36 · Score: 3, Funny

Nonsense! I happen to know that you had to be able to spell "Internet" in order to get the VC millions.

Silly monkey.

--
Why yes, I AM a rocket scientist!
Re:want confirmation? by glitch! · 2004-02-18 11:45 · Score: 2, Funny

You played Lemonade Stand in high school?

Actually, yes :-)

Don't you know all the cool kids were playing Oregon Trail.

D'oh! At my school, the hot game was Three Mile Island. We never got the good games! :-)

--
A dingo ate my sig...
Re:want confirmation? by newbrier · 2004-02-18 11:59 · Score: 3, Interesting

Apple has had zero long term debt for over a year now, and in the course of normal business it is impossible for a company to elimintate short-term debt or at least in theory for a company of Apple's size since the company incurs short term debt by having a phone bill. Hence the reason at the end of last quarter Apple had almost 1.1 billion in accounts payable. In the end a company seeks to find its optimal capital strucure of debt and equity that will return the maximum shareholder value. Apple has choosen to reduce its risk of market highs and lows by eliminating the long term debt exposure of the company. Futher more, while I love Apple, being debt free is not a reason to buy its stock or believe that it is a healthier company. It simply implies that the shareholders will not be bullied by bond holders seeking more control of the company.
Re:want confirmation? by nuntius · 2004-02-18 12:11 · Score: 1

I think he meant something more like
(1+prime)^((1+prime)^(1+prime))

but even this gives low values
(prime=4% yields only 4.3%)
Re:want confirmation? by bradly.mcconnell · 2004-02-18 15:39 · Score: 1

Little off topic, but thanks for the link - it's quite informative.
Re:want confirmation? by Anonymous Coward · 2004-02-18 17:57 · Score: 0

Not true. Having the "intarnet" could be worth big bucks!
Re:want confirmation? by djdavetrouble · 2004-02-19 05:29 · Score: 1

hehe hohoho
mervyn's

hahahahahaha

he said mervyn's.

bwahahahahahahaha.

Mervyn's.. tee hee

hehe
ohhhh yeah good one..

--
music lover since 1969

Because.. by LilGuy · 2004-02-18 07:09 · Score: 5, Funny

They didn't make a game console that doesn't make money.

--

You're nothing; like me.

Re:Because.. by homeobocks · 2004-02-18 07:13 · Score: 2, Insightful

Nor did they make a chat client and protocol that loses money. In my opinion, Microsoft is just doing this to take over the market, so they can up the prices when there are no competetors. The bread and butter of a monopoly.

--
MOUNT TAPE U1439 ON B3, NO RING
Re:Because.. by sydsavage · 2004-02-18 07:15 · Score: 5, Informative

You've obviously never heard of Pippin.
Re:Because.. by Kenja · 2004-02-18 07:15 · Score: 5, Informative

Yes they did. It was called the Pippin and was relased by Bandai. It did very bad in the US and Japanese markets. It booted MacOS 7 off of a CD (no internal storage) so, while it could run any Macintosh game, the game had to be built with an OS image on the CD.

--

"Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
Re:Because.. by perdelucena · 2004-02-18 07:16 · Score: 4, Funny

"Apple [...] is now a debt-free company."

One more prof that Apple is still dying...
Re:Because.. by mgs1000 · 2004-02-18 07:16 · Score: 1

You mean besides the Pippin?
Re:Because.. by grecorj · 2004-02-18 07:16 · Score: 0, Troll

They didn't make a game console that doesn't make money

If you're referring to MSFT, they have 10x as much cash on hand and no debt.

I'm not sure of the significance here -- any finance prof worth his salt will tell you that there's no difference in how you finance your company (ie, debt, equity).
Re:Because.. by incast · 2004-02-18 07:31 · Score: 5, Informative

That's a half-truth. Long term debt (loans, bonds, preferred shares) bares a fixed cost every year, where common shares do not. There are many ratios that attempt to describe the mix of debt and equity, as well as their fit of the mix to the company.

For example, with more debt you incur more yearly interest and your times interest earned ratio (net profits / interest costs) decreases, which can bring about questions of solvency.

Tech companies especially need to have very conservative ratios to show their financial viability. A lot of cash and not a lot of debt seems to be the rule of thumb when you look at the NASDAQ.
Re:Because.. by Wyatt+Earp · 2004-02-18 07:37 · Score: 5, Interesting

"The game had to be built with an OS image on the CD."

That would be easy, I used to have a 7.5.5 boot CD and if I remember right, that stripped down System Folder took up all of about 30 MB with full network functionality.

Once we made a System 7.1 boot floppy with Appletalk and I don't remember what else so that we could dasiy-chain Performa 5xx series machines with the old LocalTalk boxes and phone cords and reformated 14 of them at a time from my G3 AIO.

I
Re:Because.. by visgoth · 2004-02-18 07:38 · Score: 2, Interesting

An interesting idea, actually. I had once semi-jokingly said to a friend that a stripped down linux on a disc could be used as a basis for games. In theory it would work pretty well, only the necessary stuff is loaded up. However, there would be no way to know what sort of hardware the machine booting the disc would have installed. I guess this is basically the idea behind those ill fated linux based consoles?

--
My patience is infinite, my time is not.
Re:Because.. by Mod+Me+God · 2004-02-18 08:05 · Score: 3, Informative

any finance prof worth his salt will tell you that there's no difference in how you finance your company (ie, debt, equity)

Any incompetant finance prof, that is. The Modigliani-Miller theorem has that premise, but it can be broken down because of tax differences, risk preferences, and of course efficient capital markets. In theory, different types of firm have different optimal capital structures (and in practice there are differences between different types of firm).

If you're interested in the theory then check out the paper Miller wrote in retrospect.

--
-- FreeNET user? Comfortable with the adverse selection?
Re:Because.. by stilwebm · 2004-02-18 08:08 · Score: 1

"The game had to be built with an OS image on the CD."

That would be easy, I used to have a 7.5.5 boot CD and if I remember right, that stripped down System Folder took up all of about 30 MB with full network functionality.

Similar to what the Sega DreamCast did with Windows CE.
Re:Because.. by Monkelectric · 2004-02-18 08:12 · Score: 1

Except its been done.

--
Religion is a gateway psychosis. -- Dave Foley
Re:Because.. by Anonymous Coward · 2004-02-18 08:15 · Score: 0

That's been done a number of times. Look up "Knoppix Mame" on source forge for a recent one. Bootable CDs with an arcade emulation and as many ROMs as would fit have floated around for quite a while.
Re:Because.. by Anonymous Coward · 2004-02-18 08:16 · Score: 0

This guy shouldn't have been modded +5, Funny on the grounds that someone with a proper grasp of English could have pulled it off much better. With this post, I have to basically create the joke in my mind because the English is so terrible it doesn't really convey the true meaning of the joke.
Re:Because.. by edgar_is_good · 2004-02-18 08:31 · Score: 2

And, of course, this misses the point that having no debt and lots of cash allows tremendous flexibility in acquiring other assets, like software companies. If you're already debt-laden this is much more difficult.
Re:Because.. by noewun · 2004-02-18 08:31 · Score: 4, Informative

Letting someone else build the guts of OSX was the smartest thing they ever did.
You, sir, are an idiot.
NeXTStep, the basis of OS X, was developed at NeXT while it was owned and run by Steve Jobs. "Someone else" didn't build the guts -Jobs oversaw it's deveoplment. When he moved back to Apple, Apple acquired NeXT, bring both his children together.

--
I am a believer of momentum and curves.
Re:Because.. by tyrione · 2004-02-18 08:42 · Score: 4, Informative

Someone with a bent for Truth. Thank you.

And I'd like to add that Apple Engineering enhances or completely refactors bits and pieces of the NetBSD, OpenBSD, FreeBSD code, and give back accordingly per any licensing agreements.

This reminds me of when people give Adobe the credits to developing Display Postcript and NeXT just licensed it. DUH! Without NeXT it wouldn't have come about, let alone Display PDF, etc. Let's give credit for ideas and code where they are due.
Re:Because.. by F34nor · 2004-02-18 08:59 · Score: 1

e.g. America's Army for AMD's 64 bit chips?
Re:Because.. by Breakfast+Pants · 2004-02-18 09:02 · Score: 1

"and give back accordingly per any licensing agreements. " Then in the case of the bsd's they wouldn't be giving back anything. But they do.

--

--

WHO ATE MY BREAKFAST PANTS?
Re:Because.. by DigiShaman · 2004-02-18 09:10 · Score: 1

I thought WinCE was built into the Dreamcasts boot ROM, except using Segas own GUI shell. Oh well...I guess I thought wrong.

--
Life is not for the lazy.
Re:Because.. by isaac · 2004-02-18 09:34 · Score: 4, Informative

This reminds me of when people give Adobe the credits to developing Display Postcript and NeXT just licensed it. DUH! Without NeXT it wouldn't have come about, let alone Display PDF, etc. Let's give credit for ideas and code where they are due.

Then you should credit Sun. Their NeWS client-server windowing system (which began development in 1985) used PostScript to describe objects on the screen, but predated NeXT and Adobe's Display PostScript. See http://www.postscript.org/FAQs/language/node73.htm l and http://en.wikipedia.org/wiki/NeWS for corroboration.
NeWS eventually was absorbed into Sun's OpenLook environment. To this day, Sun's X server supports Display PostScript, as anyone who uses a Sun workstation knows. (A logo to this effect is displayed when the X server starts.)
I don't mean to belittle NeXT here - I've been a NeXT user for a decade and still have a working NeXTStation TurboColor and NeXTLaser Printer. Display PostScript wasn't really a NeXT innovation, however. (Objective-C on the other hand, was all NeXT)
-Isaac

--
I am not a lawyer, and this is not legal advice. For Entertainment Purposes Only.
Re:Because.. by BrianCarlstrom · 2004-02-18 09:39 · Score: 1

Letting someone else build the guts of OSX was the smartest thing they ever did.
You, sir, are an idiot.
NeXTStep, the basis of OS X, was developed at NeXT while it was owned and run by Steve Jobs. "Someone else" didn't build the guts -Jobs oversaw it's deveoplment. When he moved back to Apple, Apple acquired NeXT, bring both his children together.

NeXTStep was largely based on Mach from CMU which itself relied heavily on BSD from UC/Berkeley.
I'll grant you that NeXTStep did add a lot on top, especially in the application framework as well as a new driver architecture, but even OS X shows its BSD roots pretty clearly.
Re:Because.. by mroch · 2004-02-18 09:48 · Score: 1

If he has ever had a real English "prof", he should know better...
Re:Because.. by good+soldier+svejk · 2004-02-18 10:18 · Score: 1

That would be easy, I used to have a 7.5.5 boot CD and if I remember right, that stripped down System Folder took up all of about 30 MB with full network functionality.

Once we made a System 7.1 boot floppy with Appletalk and I don't remember what else so that we could dasiy-chain Performa 5xx series machines with the old LocalTalk boxes and phone cords and reformated 14 of them at a time from my G3 AIO.
Yeah, I used to make my guys OS9 bootable CDs with Apple Software Restore and disk images. They would just boot a Mac off the CD and image the drive in about five minutes. Making the images took some time, but building the CD was trivial. I managed to milk this through OS X 10.1, but when Jaguar came out I was no longer able to build a compressed image small enough to fit on the CD. Once I have the time to figure out how to make a bootable DVD, I'll resume this practice. For now we use iPods, which are nice because the guys can listen to music on their way to the users (we get great deals on iPods. I got one for $69). Panther and Jaguar have ASR built into them, so they are even better for this purpose than MacOS was. Although, it is harder to build a bootable OS X disk than it was a Mac OS one.

Back in the day, I distributed System 7.5 bootable floppies much like your 7.1 disk and we ran tools off a NetaTalk server.

--
It is cowardly, and a betrayal of whatever it means to be a Jew, to act as a white man

-James Baldwin
Re:Because.. by ehiris · 2004-02-18 10:19 · Score: 1

Show me a game console based on BSD and I'm buying it :)
Re:Because.. by ttldkns · 2004-02-18 10:26 · Score: 1

PS2 is linux based, although it is in bootrom, not on a disk.

--
How many computers are too many?
Re:Because.. by noewun · 2004-02-18 10:28 · Score: 1

No argument. I interpreted the "guts" of the parent post to refer to NeXTStep, which is the immedate predecessor of OS X. As we chase down the family tree, we find more and more kin.

--
I am a believer of momentum and curves.
Re:Because.. by stilwebm · 2004-02-18 10:29 · Score: 1

I had to fact-check myself, but found it here:

http://www.microsoft.com/msj/0799/directx/direct x. aspx

I knew at least the DreamcastOS could load from the GD-ROM, but had to doublecheck on WinCE.
Re:Because.. by Anonymous Coward · 2004-02-18 10:32 · Score: 1, Funny

You must have been the moron I overheard haranguing the salespeople at Fry's because the $199.99 PC on sale for which you had been saving your dishwashing money reverted to $299.99.
Re:Because.. by rixstep · 2004-02-18 11:45 · Score: 2, Informative

For someone interested in accuracy, you seem to get way off from the truth a lot.

1. Whatever the relationship with Sun, it is a fact that Adobe and NeXT worked together on the standard used on the latter's boxes.

2. NeXT did not develop Objective-C. Brad Cox did. NeXT licenced Objective-C from Brad's company Stepstone until 1995, when they bought the rights outright.

Et voila.
Re:Because.. by Phroggy · 2004-02-18 22:16 · Score: 1

Here's a link to the System 7.5 Network Access boot disk, plus instructions on how to write it to a floppy in Windows. Used to be available on Apple's FTP site, but Google found this first and I'm too lazy to look further.

Anyway, yes, it has AppleTalk, but not TCP/IP.

Apple also has a Mac OS 8.1 Disk Tools floppy image you can download, which is a seriously hacked-up version of Mac OS (without the Mac OS 8 Platinum theme; it looks like System 7) with HFS+ support, but no network access. Includes Disk First Aid and Drive Setup.

--
$x='S24;r)>63/* h@<5+oZ)32"5cz';$me='phroggy'x$];
$x=~y+ -xz+\0-Tx+;print$_^chop$me for split'',$x;
Re:Because.. by perdelucena · 2004-02-19 00:33 · Score: 0

I am not a native speaker, you insensitive clod!!!
I live in the jungle and the monkey problem here is even worse now.

How does this compare with other companies? by Raleel · 2004-02-18 07:09 · Score: 4, Interesting

Particularly other hardware and software firms?

--
-- Who is the bigger fool? The fool or the fool who follows him? --

Re:How does this compare with other companies? by krog · 2004-02-18 07:13 · Score: 3, Funny

How does this compare? Favorably.

--
Cretin - a powerful and flexible CD reencoder
Re:How does this compare with other companies? by NecroDeemer · 2004-02-18 07:16 · Score: 1

Well, Microsoft aren't in debt I think, nor are SCO. Not sure about smaller Linux based companies.
Re:How does this compare with other companies? by justanyone · 2004-02-18 07:18 · Score: 5, Interesting

So, it seems Apple, like White Castle, among other companies, is debt free.

However, being debt free is not necessarily a good thing. I was informed by an accounting / MBA friend that having corporate debt can be a very, very good thing when it comes to tax time. Apparently, it's useful to mortgage certain properties (including real estate, physical plant, etc.). This lets you write down things or depreciate them differently I think.

I'm sure there's accountants out there (though how many of them read Slashdot is an open question). Can anyone explain this? Or Refute it?

-- Kevin J. Rice, programmer (not accountant!), Chicago area.

--
Unitarian Church: Freethinkers Congregate!
Re:How does this compare with other companies? by MadCow42 · 2004-02-18 07:27 · Score: 5, Informative

Also, debt reduces the cost of capital for a company (i.e. the return expected on money used).

If I were to invest $10 in a new research effort, if it were "borrowed" money the cost of capital would be only the interest on that $10 until I expected the research to pay back $10.

However, if that $10 came from my debt-free bank account, my shareholders would expect a certain rate of return on that investment which is typically much higher than interest rates are right now (which is why people invest in stocks in the first place, they're higher risk, but they expect higher returns).

Typically, cost of capital can be 15%, 20%, or more depending on the industry and stock performance. Borrowed money is cheap.

MadCow.

--
I used to have a sig, but I set it free and it never came back.
Re:How does this compare with other companies? by The+Slashdotted · 2004-02-18 07:41 · Score: 3, Informative

While not an accountant, I've taken Managerial Accounting a few times. :)

One of the indicators investors and managers look at is cash flow. By closing lines of credit, the company has less liquidity should a downturn happen. The bankers may be willing to re-open accounts, and resell bonds, but there is a cost involved.

In a high interest-rate enviroment, this would be financially wise thing to do.
Then again, the PR value of this news shouldn't be underestimated.
Re:How does this compare with other companies? by jafac · 2004-02-18 07:47 · Score: 1, Funny

as any Bush-supporting Republican will tell you:
Surplus=BAD EVIL!
Debt=good.

--

These are my friends, See how they glisten. See this one shine, how he smiles in the light.
Re:How does this compare with other companies? by nelsonal · 2004-02-18 07:49 · Score: 5, Informative

Most technology firms are not in debt, or carry a token amount. There are three major reasons for this. First, successful technology firms generally mint money. Dell, Intel, MS, Oracle, and a whole host of others generated well over 1 billion in cash last year (and the year before, and before, etc), so they can fund expansion projects with retained cash. Second equity buyers have been happy to give them money with no expectation for a dividend for an increasingly small part of the company. Effectivly share increases mean that investors are willing to accept a smaller part of the company for the same amount of money. Finally, the rating agencies (the companies that issue opinions about how risky debt is, which are used by lenders to establish the rate at which they will loan money for) treat technology firms like late paying poor people. My personal rule of thumb is that technology firms will have a rating at least 3 notches or one full grade below a company with the same credit statistics in any other industry. Credit agencies look at a host of ratios for the basis of a rating. Two examples are Apple and Oracle both have well more than 10 times more cash than debt, and both have a long history of generating relativly stable operating cash, (more important to lenders than profits). If they operated in any other industry they would be at least AA (credit ratings go down from AAA, AA, A, BBB, BB, B, CCC, CC, C with + and - modifers on each rating, and D is a special rating for in default, ie not paying even the interest on the debt and no modifers). BB is the beginning of junk bonds. Apple's credit rating was BB and Oracle's was A-, to give you an some comparisons Qwest is B (they were touch and go on bankruptcy for the better part of 2002 and 2003). MS would likely not get a AAA rating with almost 60 billion in cash, and a two decade history of positive cash flows. Generally the rating agencies perceive a ton of operational risk in all firms that are involved in technology.

--
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
Re:How does this compare with other companies? by Dukael_Mikakis · 2004-02-18 07:49 · Score: 5, Interesting

Yes, debt does reduce the cost of capital because every $1 of new equity will cost you an expected value of $1 (if it were higher, people would bid up the stock price; if it were lower, nobody would buy the stock). Every $1 of debt will cost you interest (typically less than 100%, so maybe $0.05). The reason why people ever issue equity over debt is that you can typically raise much more money more more easily in the stock market than at a bank. Put yourself on the market and millions of people might contribute equity, looking to get some of the profits, and they'll do it (essentially) no questions asked, as long as you pad their wallets. If you get some debt, you'll have to deal with restrictions, you'll have to keep some amount of cash in the bank, the bank could liquidate your assets and shut you down .... In short, with equity, if you screw up (within the law) nothing bad will happen to you beyond that -- shareholders lose money, sell their stock, oh well. With debt, if you screw up it's a big hassle, banks can sell your stuff, assume management, etc. Risk of bankruptcy is the only reason why equity is ever issued.

So if Apple's not at risk of bankruptcy (they're not), they should have no problem finding cheap debt to invest. In this case, I think it's foolish for Apple to pay it's debt off.

Plus, the interest you pay on debt is tax deductible itself (as an expense) and that's just an extra bonus to load up on debt (assuming you can afford it, and aren't at risk of failing).
Re:How does this compare with other companies? by spleck · 2004-02-18 07:54 · Score: 5, Informative

Did anyone else notice that one of the posts said their debt was DUE in February 2004. They didn't just go and pay off a loan. They met their contractual obligations to repay debt.

It's up to the finance guys to say, "Hey, we can borrow another $300 mill for 5% while we're making 6% on our investments." If they can't say that, then they won't borrow more money unless they need it.
Re:How does this compare with other companies? by Bendebecker · 2004-02-18 08:02 · Score: 2, Insightful

You also have to look at stock value. If this gets their stock to go up, it might be overall a good thing to pay it off just so you can say you did and then immediately go back into debt (by dumping cash in something.)

--
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most of us won't be able to afford it.
-- Lemmy
Re:How does this compare with other companies? by missing000 · 2004-02-18 08:12 · Score: 1

Or, "I like speed!"
Re:How does this compare with other companies? by B1ackD0g · 2004-02-18 08:22 · Score: 1

This may be modded as a troll, but isn't Microsoft another successful company that has a lot of money in the bank and very little debt?

I haven't taken the time to look at their filings though, so I may be completely off base. Still, the reported $40 billion in excess cash had to start as a debt free sum somewhere didn't it?

--
When I'm feeling down, I like to whistle. It makes the neighbor's dog run to the end of his chain and gag himself.
Re:How does this compare with other companies? by nelsonal · 2004-02-18 08:25 · Score: 5, Interesting

Debt is leverage, it amplifies your returns to owners. This is great if you do well, but it is bad if you do poorly. Most people experience this when with mortgages (because of a ton of very favorable laws and a reasonably good housing market since wwII lenders will give an amazing amount of leverage on a house). Which is why they thing real estate is such a good investment, houses have actually been out performed by most other asset classes, but nothing else allows the same measure of leverage.
For a simple example lets look at buying stock on margin. Take Microsoft, let's say Bill and Steve each have $1000 to invest in MS and the current share price is $25. Bill chooses to buy 40 shares for $1000 (ignoring commissions), while steve listened to his MBA friend and bought 80 shares, taking a loan for $1000 and puting up his own $1000. The next day MS comes out better than expected earnings and the price pops to $30 per share. Both sell their stock. Bill gets $1200 (40x$30) while Steve gets $1400 (80x30-1000) I'm rounding off the $0.11 in interest expenses.
Now if the news had been bad, and the stock fell to $20, the opposite would have happened, Bill would have $800 (40x$20), while Steve would have $600 (80x$20-1000), again ignoring the $0.11 in daily interest.
With debt financing you multiply the regular returns by the inverse of the percentage you put up. (If you put up one fifth of the intial capital you will recieve five times the return on the asset (before interest expenses), if it returns 10% annually the owner will get more like 50% annually, if it returns -5% annually, the owner will get -25% annually (again before interest expenses). In our examples above the asset returned 20% but due to the differences in financing the investors got very different returns.
Armed with this knowledge the optimal situation would be nearly no owner investment and almost all debt financing, assuming an investment is likely to produce returns. However, lenders will require a higher interest rate to projects that have less owner investment decreasing the returns (the asset must return more than the interst rate for this to work, it becomes increasingly difficult to find investments that will do this. In the stock market there are regulations limiting you to debt equal to your starting capital, and if you start to loose money the broker will issue a call requireing either additonal investments or he will sell your asset to bring it back in line with the rules. With a big successful company lenders stop at about 3/4 of total investment (3:1 leverage). Houses allow a ton of leverage (the old rules were for 20% (5:1 leverage) down but I know of people who put less than 10% down (10:1 leverage). Feel free to ask any further questions, this format is not ideal for math topics

--
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
Re:How does this compare with other companies? by ProfDumb · 2004-02-18 08:35 · Score: 1

Folks are giving you way too simplistic answers about debt versus equity. The only correct, simple answer is that there is no simple answer. Some are saying that debt is better than equity because interest rates are lower on debt. If this were true, all companies would issue only debt, no equity. In fact, shareholders share the risk of the company much more than debtholders and this compensates for the higher (on average) rates of return. The comparison is not obvious at all.
Re:How does this compare with other companies? by magarity · 2004-02-18 08:39 · Score: 1

As an individual consumer one is tempted to think that debt is bad no matter what. But look at things like mortgages. Even if you have the cash to buy a house, you should put the money in a good mix of mutual funds because over 30 years you'll earn more than you pay out in interest. Furthermore, there is a well known (in finance) theory that says a little bit of debt is good for a company. Why? Because there is pressure to perform month to month that is higher than the year to year market pressures. If the company can't make its debt payments, it's S.O.L. If the managers don't run it well enough to have cash every month, they lose their jobs when the company goes insolvent.
Re:How does this compare with other companies? by afidel · 2004-02-18 09:02 · Score: 2, Insightful

Not necessarily, it makes Apple a potential takeover target as a low debt to equity ratio can make a company a good choice for a stock leveraged purchase. Of course I don't see anyone going for Apple right now but who knows *shrug*

--
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Re:How does this compare with other companies? by santos_douglas · 2004-02-18 09:07 · Score: 2, Insightful

Wow, some informed financial discussion on /. - astounding!

These are all good points. In general, a debt free or even low debt corporation is a bad sign, unless there is an industry specific reason for it to be that way. At best it means the management is far too conservative and is not creating growth opportunities, or simply has run out of growth opportunities to pursue. At worst it means the firms managment is not serving the interest of the shareholder, which is all the more suspicious in a firm that pays no dividends. In a frim like Apple with a good credit rating, this will become a value destroying position in the long term.

However I suspect that they will just as quickly take on new financing, or face the consequences from their shareholders.
Re:How does this compare with other companies? by Angus+Prune · 2004-02-18 09:38 · Score: 1

Excuse my ignorance as I'm not American so may show some ignorance in regard to this BUT... (oh the eternal but)

Is this not what lead to the depression? People borrowed money to invest in a booming market as you ahve described. Then the market dropped, banks called in their debts and people ended up losing mroe money than they had?

There are essentially three types of investment.
Risk free investment This is your savings account and unless you're unlucky enough to bank with bearings your money will be safe and you'll get your interest on top of that.
Risky investment This is normal investment in the stock market. FTSE trackers and most people's shares. You go for the higher yield of the stock market but also accept the risk of losing everything.
Investment in an idea This is the only time you should borrow money to invest. This is if you want to start a bussiness, expend a bussiness. Basically if you know a good plan but need cash to realise it you may borrow for it. This might be from a bank, venture capitalists, friends, whatever.
Re:How does this compare with other companies? by mcwop · 2004-02-18 09:45 · Score: 4, Funny

They copied Apple.

--
"I don't think it's selfish, to eat defenseless shellfish." -NOFX
Re:How does this compare with other companies? by Luigi30 · 2004-02-18 09:47 · Score: 1

MandrakeSoft just came out of bankruptcy, so I guess they paid off their debt.

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Re:How does this compare with other companies? by johnnyb · 2004-02-18 09:59 · Score: 1

Or they could just be moving to Biblical values (that would be odd considering Steve Job's history, however).

Biblically, someone who takes on debt unless it is completely collateralized is considered a fool.

Oweing people money, even in business, has negative consequences. If life only existed on paper, then perhaps debt would not be such a bad thing. However, in real life, having debt limits your choices greatly, and makes you overly subject to the lender and to economic conditions surrounding you.

Relying on debt financing only works when interest rates are low. If your company is in a position where it relies on debt financing to generate profits, if interest rates rise sharply it can have a devastating effect on the company, while one which has been operating debt-free will be positively affected (if they can pay cash to their suppliers in times of high-interest, you can usually secure greatly better deals than those who always pay over time).

Anyway, all that to say that what works on paper is not necessarily what works out in real life, and having debt has more consequences than the pieces of paper show.

--
Engineering and the Ultimate
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-18 10:00 · Score: 0

sounds a bit like the Asian Economic Crisis of '97/'98
Re:How does this compare with other companies? by dunedan · 2004-02-18 10:07 · Score: 1

Yeah... Us Republicans usually like to have a lot of debt in the government, especially if it means we can maintain a huge welfare state, subsidize stuff and mess with the economy in any other artificial way.

Dems are usually the ones uniterested in how much public services cost. I am a republican and I don't really like Bush's economic policy but he will get my vote because I actually believe he does whatever he thinks is right(haven't seen that in my lifetime). Even if it means crossing party lines the way his economic policy has.
Re:How does this compare with other companies? by nelsonal · 2004-02-18 10:09 · Score: 3, Informative

Short answer yes, leverage can really burn you. Long answer the great depression was triggered by a market crash, that toppled a few banks who issued too many loans to speculators who lost their shirts and the losses were quick and large enough to cause the loans to not be repaid. (I didn't mention that banks run at about 20:1 leverage ratios) so the banks began to fail, which caused a run on banks that wouldn't have failed, but didn't have enough liquidity (banks never do, in a true run). However, it was also exacerbated by a Fed decision to cut liquidity and raise interest rates at the start of this. Ultimately the depression was people sitting on currency because of fear, rather than spending or saving it. Macroeconomics is a lot like the weather, there are a ton of very complex variables that lead to effects.
Oddly enough risky investments are sometimes ok to borrow against, it's a matter of the level of risk tolerance you are comfortable with. Real Estate is ultimately a risky asset, but most of us are comfortable borrowing and lending against it, as there are considerable forces absorbing and reducing that risk. Oh, and the only risk free investment are government treasury bonds (The US seems to be the gold standard, although I'm be comfortable with Euro zone and Japanese bonds, too especially last year with the nice currency boost) banks are only as good as the government that insures them. Ultimately governments can print money so they will always pay their debts, although the currency might not be worth much, as a bunch of pensioners are learning about Argentina's bonds. Finally, it's very hard to find people who will loan money to a startup, if you do you have a very good friend.

--
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
Re:How does this compare with other companies? by ibpooks · 2004-02-18 10:16 · Score: 1

Yep, that's what happened. However at that time there weren't limits on how much speculative lending banks could do. As a result of the crash, banking regulations now limit banks' lending to prevent insolvancy even in market downturns. Consequently, the banking industry is probably the most regulated industry in the USA.
Re:How does this compare with other companies? by sd211 · 2004-02-18 10:18 · Score: 1

I agree with you friend. There are several good things about debt (for public companies): it might increase return on equity by providing additional capital for growth; reduce cost of capital if interest rate is lower than the cost of equity; provide tax benefits. There are, of course, costs associated with debt, so it is always a balance of things. In general, a company should choose debt/equity ratio which is appropriate for its business plan.
If they have too much cash on hand, they should either invest it in projects that provide return greater than market, or return it to investors (in form of dividends or share buy-back).

I am neither programmer nor accountant, but I am almost an MBA (85%) and certified (computer) geek.
Re:How does this compare with other companies? by allism · 2004-02-18 10:24 · Score: 1

If I recall correctly (I am not a historian, and it's been a while since I took a history class), the stock market crash made the depression worse but the US was already heading there anyway. There was a huge problem already in place with poor distribution of wealth and markets that were truly monopolistic (as opposed to today's supposed monopolies, but I am digressing). The government still operated on a gold standard, which meant that it was not easy to just put more paper money into the economy.

It's very important for people who get money to spend money, to keep things flowing. Since a very few people held almost ALL the money, and had no incentive to spend it on much of anything, the economy just slowed down.

--
Denver Isuzu Suzuki
Re:How does this compare with other companies? by mhoward736 · 2004-02-18 10:37 · Score: 4, Insightful

Debt is a very useful thing to have if you need extensive capital investment in material things or you need a pool of money to fund the development of an idea.

If you have no need to do capital investments in things like plant and equipment or buying another company then debt is a BAD thing because you're paying interest and usually more than you'd get investing in a similar risk item.

Americans seem to have an idea that being in debt is a good thing. For some things like a House which will normally be a long term asset whose value will be more than the total cost of the debt this is an OK idea. For cars and such its usually not a great idea as the asset depreciates very quickly, for computers its even worse. Unless of course you use that asset for something useful like running your business (one of the reasons Graphics people don't care about the cost of a new Mac is that it pays for itself very quickly).

So lets look at Apple. Their major assets are their people and ideas. If they have enough revenue to continue to pay those people they shouldn't borrow for it. R&D is normally expensive but most of what Apple does is consumer design, software development and (some) assembly. CPU's, Disks etc are all developed by others - sometimes with input from Apple. For these things they don't need extensive physical assets like factories and machinery. They need enough space for everyone to work, and they can get someone else to build/assemble their designs at very little risk to themselves usually.

This is one of the reasons why tech companies usually have very little debt.

In Apples case debt would only be good if they needed to acquire another company and believed they could run the acquisition better than the current management or they needed to invest significantly in something else that required a large chunk of change up front.

Low debt may make a company a takeover target but in Apples case you'd 1. Have to pay a significant premium over the value of their cash assests and 2. be really sure you could run the company better than Steve and his key people. Otherwise you'd be buying a declining asset or looking to put a competitor out of business. Microsoft might like to try but the Anti-trust brigade would have a field day.

As long as Apple stays profitable and can fund its own R&D internally it doesn't need more debt.
Re:How does this compare with other companies? by santos_douglas · 2004-02-18 11:28 · Score: 2, Insightful

Depends on the particular flavor of religion, some think all debt is evil, some merely believe charging interest is a sin.

I'm not sure what mean by 'on paper', there has never been an instance where debt did not exist in the real world. The fact that it is recorded by people and companies is just a matter of accounting.

Having debt does not necessarily incur negative consequences. It has precisley the consequenses you agree to when you take it on. If you can afford it, then it is positive. Quite the contrary, debt greatly expands an individuals and a companies choices. Home and auto ownership are made possible by debt. Emergency/variable funds are made quickly and easily available to anyone with a credit card. If your car breaks down in the middle of nowhere, and you have no cash, trust me, having the ability to take on debt greatly expands our choices.

Debt financing works whenever it is cheaper relative to the cost of equity capital. The nominal rate is irrelevant, it could be 1% or 50%.

A sharp rise in interest rates would affect profitability only if the rate was floating, or if new debt was needed. And even if these cases were true, even a modestly sophisticated company now can effectively hedge against such interest rate risk.

The bottom line is, debt properly used by a firm, will maximize its total return to the shareholder. The relative requirements of debt and equity holders are what determine its appropriateness. Qualitative beliefs such as debt averseness are irrational, and ultimately destroy shareholder value. A firm can operate just fine on no debt - in fact there are several surprisingly large firms that grew through much of their histroy debt free - UPS and Dominos come to mind. Still, they would likely have grown faster and generated greater returns through the proper use of debt.

The aim of finance is to optimize returns. The residual asset claim is effectively the same for both, so the only question for the firm is, which is cheaper.
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-18 12:02 · Score: 0

Basically true, but you need to distinguish between liquidity (which the banks had) and solvency (which they didn't).

Liquidity, for a bank, is the ability to readily turn your assets into cash or bank reserves. The creation of the Fed as lender of last resort garanteed that the banking system had liquidity (any bank could get a short term loan at the discount window by putting up its loan portfolio as collateral. This ended the periodic banking panics of the late 19th and early 20th century caused by the fact that a system with no lender of last resort can never maintain liquidity in the face of a true run - short answer, there isn't enough money). If the only problem had been a run on the bank, it would have been no problem.

Solvancy is the status of having ones assets greater than ones liabilities. A bank that is insolvent can't maintain liquidity, even with a lender of last resort, because it doesn't have the collateral to present at the discount window. It has failed - the regulators shut it down.

What happened in 1929-1932 was that a wave of bankruptcies caused a great deal of loans to be written off. Suddenly, banks that thought they were in decent shape turned out to be insolvent (remember - a bank's assets are its loans - you don't pay, all it has is worthless paper, especially if it has gotten a bit happy with its lending and there was no collateral). The Fed did it's job (or at least the job it was set up to do) - it's job was to maintain liquidity, not to bail out insolvent banks. But since every bank was both a holder of debt and a debtor itself, the failure of large numbers of banks (and thus the write off of their debts) caused other banks to fail, etc. etc.

Note - since then, there has been a quiet "too big to fail" policy in place at the Fed. Back in the late 80s, a big Chicago bank called Continental Illiniois was declared insolvent, due to various bad calls (to be fair, most of them by another bank whose paper CI was holding). Due to its size and the unforseeable effect it could have on the health of the financial system, Paul Volcker wrote them a multibillion dollar check - unsecured - so they could stay in business. The good news is, the Great Depression isn't likely to happen again (the late 90s were a perfect setup for a repeat, but the various circuit breakers installed since then have instead given us a few years of a limping recovery while the debt gets paid off) - the bad news is, every big bank has an implicit bailout garantee from the federal government, no matter how bad they screw up, and they know it...
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-18 12:14 · Score: 0

Another thing - about Argentina. You're right that soverign nations can always pay their debts - in their own currency. Argentina's problem was that it had a large debt denominated in USD. It had to service the debt by obtaining dollars, which it could only do by exporting, but the proces of all its exports were falling. The reason it had the debt in the first place was its bad decision (cheered on by neoliberal types, at least at the time) to peg its currency to the dollar. In order to maintain the peg, its CB had to hold enough dollars to maintain a one-for-one ratio. Once it abandoned the peg, it still had the outstanding debt. Of course, since it was non-recourse, unsecured debt, they basically said "oops!", and refused to pay...

All of which is another way of saying that you don't have to worry about your U.S. treasury debt - the U.S. gov can always pay any obligation denominated in USD. I'd tell you why "printing money" is technically impossible (or, depending how you look at it, all government spending is accomplished through "printing money", since the money has no existance until the Gov spends it into circulation...), due to the way the US financial system operates, but it would take too long...
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-18 14:17 · Score: 0

HA informed thats funny.

You are of the same ilk that having a 'mortgate' is good. You are only borrowing money for a 'fee'. Short term the loan is good, no its GREAT. You have a pile of money that you can spend NOW. Long term it can cost you more than if you had just waited and saved. However waiting can be deadly in industry which why borowing there can be good. However if you do not have to borrow its even BETTER. If however you are borrowing money for a risky venture and it fails how do you pay it back? Apple wants to stick around. They have put themselves on a solid foundation to do so.

Take one of the a more successfull business in the US, Microsoft. They have a 40billion dollar warchest. They can afford to make mistakes, spectacular mistakes. Think they would have been able to make a run at the console industry operating at a loss on hardware without it? Ver 2 will be 'ho hum' 3 will be interesting 4 will be a must have. Like all ms products...

If I could pay my house off right now I would. It would save me nearly 200k in interest payments. I would only get 30% of that back from uncle sam in little mini chunks. Oh yes thats a GREAT ROI.

Let see at 300 million at 6.5% which if I think is what they had is like what? 19.5 MILLION dollars a year? A manager where I work put it best. For each extra million you make consider it a 1 cent add to the price of the stock. In theory Apple just added 20 cents to the value of the shareholders (you know the people who own the company). Thats pretty good ROI for them. And thats PER year. They can now instead of giving money to banks they can use that money to buy R&D, leverage part buying (i have a pile of cash), make R&D mistakes that they can write off, and so on. There is something to be said of a company that has no debt. You also do not have another company whos interest it is to sway your company to their betterment. You are beholden to none. Sitting on a pile of money is good. You can use that money to get better deals if you need a loan. If you can get MR=MC as close as possible with out borrowing you are hitting the micro econ sweet spot...

This is also good for customers. They can also lower prices on goods as price per unit is now lower. Basicly you have moved the cost of goods downward. The demand graph is unchanged. I predict not record losses in the next few years but record profits from them. They will be selling units at a lower cost and more people will be willing to buy at that price. Debt would be considered a fixed cost. Removing costs is a decent way that you can do something positive too. Not fire people. I would also be willing to bet within the next 2-3 years you see dividends from Apple.

I see companies that have large debts and do not need it as pissing away profit. Those are the ones that you need to watch out for. I have worked for those as well. They are not pleasent places to work. They are always worried about what they can write off. They like to fire 2500 people at a time and dont blink. They close plants and move them somewhere else when the 30 year depreciation expires. Yes those are such great compaines. They pull in 8billion in profit but operate at a loss. They are so built into the scheme they end up with they can never get themselves out. They have record losses yet somehow have a 1.50 dividend. There is something fundamentaly wrong there.
Re:How does this compare with other companies? by lhbtubajon · 2004-02-18 15:54 · Score: 4, Insightful

What you say is true, all else being equal.

However, you fail to consider the intangible benefits of being able to show investers that you went from $1 billion in debt to no debt whatsoever.

In 1997 Apple was in very bad shape, and investors and consumers were distancing themselves from the potential for losses and orphaned technology.

There is now a great reassurance to people who might buy Apple products that the company is recovered fully, will exist indefinitely, and can be safely counted upon.

Jobs likely expects the benefits to outweigh any loss of financial opportunity here.
Re:How does this compare with other companies? by johnnyb · 2004-02-18 16:32 · Score: 2

"If you can afford it, then it is positive."

I was specifically talking about uncollateralized debt, in which case, you can never know for sure if you can afford it.

There is no such thing as offset. Here is a true story (I forget the actual numbers, but the gist is true):

A man had an account into which he had put $90,000. He took out a loan for $50,000 from the same bank and put it into the account. This seems safe, right? Well, very soon afterwards the bank closed. His FDIC paid him $10,000 for the money in the account. However, he still owed the bank $50,000. There's no such thing as offset. The fact that he had more in the bank than he owed made no difference when they were settling accounts, and all of a sudden he went from having +$90,000 to -$40,000. Had he not borrowed, the worst he would have gone was $10,000.

The fact is, uncollateralized borrowing puts you into a different game - one which many win, in fact. However, it is always a burden, and it is always a controlling burden.

--
Engineering and the Ultimate
Re:How does this compare with other companies? by santos_douglas · 2004-02-18 16:47 · Score: 2

Well, comparing personal borrowing to corporate borrowing is a bad idea, and I probably shouldn't have even started down that road. Since your average person doesn't borrow to invest, only to spend, its tough to compare. Although since homes do appreciate in value, as long as your annual gain outpaces or at least equals your interest, you've made out. Saving up for a house? Nice idea, but not bloody likely. You can't just think about the interest you'll save, you do have to live somewhere - and that probably means rent, and lots of it.

Another important point - 200k (est) in interst is a nominal figure. You have to do a present value adjustment, which would make it quite small in todays (real) dollars. Given the competiveness of the mortgage industry, the relatively low risk of houses as assets, and the current interest situation, buying a home on debt is a pretty good deal.

Anyway, back to the business side of things, Apple seems to be in line with the industry - Dell, MS, all have virtually no debt. HP is the exception, which is probably merger related. So this looks like the expectation for this indsutry, and therefore a good thing. But in other industries it is completely different, and a debt heavy capital structure is quite common.
Re:How does this compare with other companies? by swillden · 2004-02-18 18:46 · Score: 2, Insightful

Long term it can cost you more than if you had just waited and saved.
Only if your interest (not mortgage) payments exceed what you'd pay in rent. You still have to have a place to live while you're saving for your house. Keep in mind also that while the portion of your house payment that goes to interest decreases during the course of the mortgage, your rent will go up. The appreciation on the value of your home also tends to offset the money lost to interest.
Let's look at some numbers. Suppose that you purchase a home for $200,000, on a 30-year loan at 6% interest. Suppose that renting the same house would cost $800 per month. Suppose that inflation is at 2% per year for the duration and that both rent and home values increase accordingly. Finally, suppose that you pay about 20% in net taxes, and that you can itemize and deduct your interest payments.
Your monthly mortgage payment is $1,199.10, which means that your total payoff cost will be $431,676.38, which means you'll pay a total of $231,676.38 in interest. That sucks, right? Sure it does, but not as much as it might appear. First of all, that interest is tax deductible, which basically means that you'll get 20% of that back, so it's really only $185,341.10. Still a big chunk of change, certainly.
However, look at the rent side of it: Even if we assumed your rent never went up, you'd pay out $288,000 during those 30 years. Assuming an annual 2% increase in rent prices, that's $389,453.56 over 30 years. That sucks much worse than the $185K in interest.
Now let's look at what you have at the end of the 30 years in each scenario. Assuming you rented and banked the difference between your rent payment and the mortgage payment you opted not to take, you'd accumulate somewhere in the neighborhood of $100K (I'm too lazy to figure that one out exactly; it's around $55K plus some accumulated interest, which I'm assuming is at 5%) over the first 20 years at which point your rent payments exceed what your mortgage payments would have been, so you have to start dipping into the savings account to pay your rent which means that your savings grows more slowly. I estimate that your final balance will reach about $150K -- not even the original purchase price of the house, and nowhere near its present value.
On the other hand, if you borrowed and bought, at the end of 30 years, you own a home worth around $350K.
At the end, borrowing money and paying interest saves you $200,000 over renting and saving for a home that you may never actually get to buy. In practice, there are some costs to owning a home that renters don't incur, which will eat away some of the difference, but you're still much better off.
There's a whole lot of guesswork and estimation in the above numbers, but I think they're pretty realistic. If anything, they're slanted a bit in favor of renting -- the cost of rent tends to be closer to the cost of a mortgage payment, and in some cases exceeds it. Many people also have higher net tax rates than 20%, which means they get proportionally more benefit from the tax deduction.
I'm not a big fan of debt, but some debt does make sense for individuals. Corporations are an entirely different can of worms of course, since their debt can usually generate revenues and profits that far outweigh the cost of financing.

--
Note to ACs: I usually delete AC replies without reading them. If you want to talk to me, log in.
Re:How does this compare with other companies? by John+Hurliman · 2004-02-18 20:19 · Score: 1

Assuming Apple's cash accounts are properly insured this isn't a threat to them like the person in your story. The analogy would be Apple's danger of bankruptcy, where the debt would be hazardous. The original parent poster made the assumption that's not a concern for the company right now, unless Apple is sending out the message that they are going ultra-conservative? We'll see whether they're jumping back in to a growth phase or getting ready for a hardship.
Re:How does this compare with other companies? by bigsmelly · 2004-02-18 21:27 · Score: 1

I'd argue that this is due to tangible assets.

I.e. that a tech company doesn't need much - just rented office space, a few computers and a payroll. If they go bust, there's nothing to sell (maybe some IP?)

A manafacturing company however may own machinery, premises, raw materials and finished products.
When they are wound up, you can sell all the trucks and cranes and raw materials.
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-19 07:32 · Score: 0

FDIC covers up to $100,000, so I think you're leaving off a zero somewhere.
Re:How does this compare with other companies? by unother · 2004-02-20 13:07 · Score: 1

That is a worthless example, I'm afraid to say, even if it is true. But I'd be hard-pressed to say that anyone who could get an uncollateralized loan for $50000 would be so stupid as to merely dump it into an account at the same institution.

Obviously, any loan of that sort would have been best used to be wisely invested, in something where the interest due on the loan did not exceed the expected rate of the return. If true then this is a retarded person (and again, I just can't see anyone above the age of 12 thinking this makes any sense).
Re:How does this compare with other companies? by Anonymous Coward · 2004-02-20 13:09 · Score: 0

Yes, Hitler and Stalin did what they thought was right too.

What amazing Republitard logic...

First to say - Well Done by IamGarageGuy+2 · 2004-02-18 07:10 · Score: 3, Interesting

Any company in this day and age that can consider itself solvent has to be doing something right. You may not agree with the tactics but the end result of being debt free is quite an accomplishment. Now if only the rest of us could say the same !!!!

--
Stay tuned for new sig...

Re:First to say - Well Done by be-fan · 2004-02-18 07:14 · Score: 5, Interesting

Debt isn't an inherently bad thing. Without maintaining some debt, its hard to become economically successful. One of the key reasons why Britain is so rich, for example, is because it was willing to carry a debt in the process of expanding, while other countries were not.

They key is to manage the debt carefully, and make sure that the interest payments do not get so large that they start eating away at your profits.

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by Lev13than · 2004-02-18 07:24 · Score: 5, Informative

Umm... Debt != Insolvent. Apple has always been solvent.

Solvency is the ability to cover current debts (loans due in less than 1 year) with current assets (cash, inventory, short-term paper etc...). As others have pointed out, carrying debt can have a number of advantages, including tax treatments, treasury management, leverage etc...

For example, loans increase the usable cash for a company, which allow you to make more money than you could with just equity. And, since someone else has loaned you the money your return on equity (ROE) is higher. Since high ROE is a good thing, debt is an important part of the equation.

--
When you have nothing left to burn you must set yourself on fire
Re:First to say - Well Done by Misch · 2004-02-18 07:25 · Score: 5, Funny

They key is to manage the debt carefully, and make sure that the interest payments do not get so large that they start eating away at your profits.

Would you like to run for Congress? ;-)

--

--You will rephrase your request for me to go to hell. Goto statements are not acceptable programming constructs
Re:First to say - Well Done by Silverhammer · 2004-02-18 07:27 · Score: 2, Informative

Blockquoth the poster:

Any company in this day and age that can consider itself solvent has to be doing something right.

Small correction: to be solvent, you merely need to have more assets than debts. Most companies are solvent by this definition, and in corporations, the difference is considered "stockholder equity": the cash that would be divided amongst the stockholders if/when the company was liquidated.

On the other hand, for a corporation to be completely debt-free is a rare achievement.
Re:First to say - Well Done by micromoog · 2004-02-18 07:30 · Score: 0, Flamebait

Have you not been paying attention at all for the past three years?
Re:First to say - Well Done by JDALaRose · 2004-02-18 07:31 · Score: 1

That is not true.
The value of the GBP has not been linked to gold for some time. Wikipedia states: "In common with all other world currencies, there is no longer any link to precious metals. The US dollar was the last to leave gold, in 1971. The pound was made fully convertible in 1946 as a condition for receiving a US loan of 3.75 billion US dollars in the aftermath of World War II."
Re:First to say - Well Done by McShazbot · 2004-02-18 07:38 · Score: 1, Insightful

One of the key reasons why Britain is so rich, for example, is because it was willing to carry a debt in the process of expanding, while other countries were not.

Of course, it doesn't hurt to colonize numerous less powerfull nations, systematically remove all profit and natural resources, then "benevolently" grant said colonies their independence when everything of value is gone and they're no longer profitable to the empire. Just ask the Indians and north Africans . . .

--
When life gives you lemons, make lemonade. But when life gives you crap, please don't make a beverage out of it.
Re:First to say - Well Done by TopShelf · 2004-02-18 07:40 · Score: 4, Insightful

Actually, the Democrats are traditionally known as "tax and spend", which means they pay as they go, whereas the current administration has chosen to borrow and spend...

--
Stop by my site where I write about ERP systems & more
Re:First to say - Well Done by be-fan · 2004-02-18 07:41 · Score: 2, Interesting

We're "tax and spend" liberals, not "borrow and spend" conservatives!

Three words: $500 billion deficit.

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 07:46 · Score: 0

Three words: $500 billion deficit.

Um, you do realize that's FIVE words, don't you?

1. Five
2. Hundred
3. Billion
4. Dollar
5. Deficit

Having said that, I have two words for you: learn to fucking type. ;-)
Re:First to say - Well Done by be-fan · 2004-02-18 07:52 · Score: 1

The British were rich long before colonialism. Anyway, the British weren't in the colonial countries long enough to "systematically remove all profit and natural resources." Although, certain companies like De Beers do need to be kicked out of former colonial countries.

PS> The Indians and North Africans (Egyptians, anyway) are not so terribly resentful of the British anymore. The British colonial empire was certainly not a good thing, but it did little permanent damage, at least in India.

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 07:55 · Score: 0

its actually 1 trillion just to be picky.

conservatives. the only people who would nitpick about spelling when loosing a fight.
Re:First to say - Well Done by Saint+Mitchell · 2004-02-18 07:55 · Score: 2, Informative

The borrow and spend method, also known as the "tax cuts for us and spend our grandchildren's money" method. May the fleas of a thousand dogs come to nest in the genitalia of those responsible.
Re:First to say - Well Done by be-fan · 2004-02-18 07:55 · Score: 1

It depends on your definition of "word" (hey, I did say I was a liberal, didn't I?) I'm using the C++ definition of "word," where a word is a sequence of characters seperated on both sides by whitespace.

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by Shisha · 2004-02-18 07:58 · Score: 4, Interesting

Of course, it doesn't hurt to colonize numerous less powerfull nations, systematically remove all profit and natural resources, then "benevolently" grant said colonies their independence when everything of value is gone and they're no longer profitable to the empire. Just ask the Indians and north Africans . . .

This still compares favourably with countries like France and Spain that did the same thing and didn't become sucessful :-) Not to mention the Germans who didn't even manage to colonise anyone at the time.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 07:59 · Score: 0

Exactly right. But you can't judge by todays standards. Britain *did* run up a huge debt while colonizing north america, africa, india, australia etc etc, but that risk payed off fantastically well for them, being in that time the most powerful nation the planet has ever seen or is probably ever likely to see. I don't think however that a lot of Indians would like to hear you belittle their struggle for independence, something that was definitely taken of their own accord. The trade between Britian and its colonies was very much a two way enterprise, had it not been for WW2, Britain would probably still be holding a large amount of it's former colonies; the battle to liberate Europe simply cost too much and the money being spent on colonial areas had to be spent at home. Much of the mutilation of indigenous populations was committed by the white settlers after independence, - the North American Indian and Australian Aboriginal are examples. The knee-jerk stuff you've just typed in four seconds is what every other ill-informed moron on the planet thinks and is wrong.
Re:First to say - Well Done by Dukael_Mikakis · 2004-02-18 07:59 · Score: 1, Informative

You must not be an American, because if you were you'd know that the Republicans have all but erased any semblance of a surplus that Clinton left us with.

Sure, many economists believe that in a faltering economy it is the government's responsibility to increase spending to "pick up the slack", but Bush has gotten out of control, spending $100B+ on war (apparently it costs San Francisco about $284M alone). Not to mention the human cost of course.

And, oh, the war did bring some great amount of wealth to America. In the form of contracts to big American corporations. So altruistic.

So running a deficit isn't a big deal, as long as you have good credit and you can finance the interest (or equivalent). It doesn't seem that Bush is doing us any favors by running up a deficit and hurting our credibility globally.
Re:First to say - Well Done by PugMajere · 2004-02-18 08:01 · Score: 1

Yup, pretty sure the caste system in India survived largely unharmed.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 08:01 · Score: 0

NEW IN!!! 5 = 1!!
Re:First to say - Well Done by Hi,+I'm+Troy+McClure · 2004-02-18 08:04 · Score: 3, Informative

Ah.. but if you already have more cash than you can use, which I believe sounds like the case here, then having more cash from a loan does not increase your ROE.
If I remember correctly:
ROE = net income/shareholder equity
If cash from a loan will not increase your net income, it won't affect ROE
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 08:04 · Score: 0

No, geeks are the only people who would nitpick about spelling, or anything else trivial and stupid, while losing (you misspelled it, jackass) a fight.
Re:First to say - Well Done by corbettw · 2004-02-18 08:05 · Score: 3, Funny

Of course, it doesn't hurt to colonize numerous less powerfull nations, systematically remove all profit and natural resources, then "benevolently" grant said colonies their independence when everything of value is gone and they're no longer profitable to the empire.

Hmm, maybe that's why the dollar is so weak compared to the pound....

--
God invented whiskey so the Irish would not rule the world.
Re:First to say - Well Done by be-fan · 2004-02-18 08:11 · Score: 1

Huh? Could you explain what you mean by that?

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by BorgCopyeditor · 2004-02-18 08:11 · Score: 1

a word is a sequence of characters seperated on both sides by whitespace
So "$500 billion deficit" contains only one word?

--
Shop as usual. And avoid panic buying.
Re:First to say - Well Done by InfiniteWisdom · 2004-02-18 08:16 · Score: 4, Funny

Ah so the US must be doing REALLY great then! The federal government owes $7 TRILLION in debt!
Re:First to say - Well Done by LookSharp · 2004-02-18 08:20 · Score: 1

And which charity did you donate your tax cut to, or which grandchild's trust fund did you invest in, since you disagree so strongly with haveing less money taken out of your paycheck?
Re:First to say - Well Done by isa-kuruption · 2004-02-18 08:23 · Score: 0, Flamebait

Well, that's just hogwash. Pure conjecture, but I would expect that from someone who follows NPR, the radio station run by college professors and grad students. You know what they say about teaching, right? Those who can't do... teach.

Anyway...

As stated multiple times already in this story, borrowing and spending is a better way to do business.

For example, if a small business has $15,000 in the bank, it may be better for them to keep that capital on hand and BORROW $15,000 (using the $15,000 they have as collateral), thus keeping the money AND making the necessary improvements.

Companies, and the government, has done this for years. Apple is a good example of how to borrow money instead of spending cash on hand. Investment in business now means MORE money down the line, and guess what, it works for government too. Good examples would be the tax cuts by JFK and the tax cuts by Reagan. To be specific, the tax cuts instituted by Reagan was followed by an increase of collected income taxes by 99.1%. (Yes, that is almost TWICE as much as the previous year). This proves that investment now means higher returns down the line.

Sorry to burst your bubble.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 08:28 · Score: 0

You've made a very bad assumption, the "tax and spend" crowd doesn't tax X and then spend X, they usually tax X and spend X+Y, then it starts all over again....

Trust me I know, I live in TAXachusetts, the home of John "Tax-n-spend" Kerry.

If you want proof, I'll show you my wallet...it's empty....
Re:First to say - Well Done by angst_ridden_hipster · 2004-02-18 08:28 · Score: 1

I find it a surprising assertion that "everything of value is gone" from India.

Perhaps one could make an argument that India was not profitable to the empire at the time of Independence, but I doubt you could prove that based on a purely financial definition of "profitable."

(I'd try to bring this back on topic by making some tenuous analogy between System 9 and OS X, but I'm undercaffeinated.)

--
Eloi, Eloi, lema sabachtani?
www.fogbound.net
Re:First to say - Well Done by tehdaemon · 2004-02-18 08:28 · Score: 1

" Debt isn't an inherently bad thing."
In general, yes. In this case, NO. Poke around in the archives. There is _far_ too much debt right now, and counting - fast. These people (and they are not alone) are convinced that a major financial crash is inevitable. Any debt, if and when this happens, is a very bad thing.

"Maintaining" ??? NO!!. It is hard to expand without going into debt in the first place, but if you are no longer trying to expand, any debt beyond very short term credit (cash flow stuff) is a bad thing and should be payed off as soon as possible. Apple did the right thing here, and it means that Apple will probably be around in 5-10 years.

--
Laws are horrible moral guides, moral guides make even worse laws.
Re:First to say - Well Done by madpierre · 2004-02-18 08:32 · Score: 2, Interesting

The real advantage of the "borrow and spend" scenario is if you *don't* get re-elected. The opposition then gets to pick up the tab. The borrowed debt millstone hanging over them like the sword of Damocles. Its whats known as a win win situation, even if you lose. :)

--
siggy played guitar
Re:First to say - Well Done by tassii · 2004-02-18 08:36 · Score: 2, Informative

I don't believe anyone was griping about tax cuts. It was cutting taxes and increasing spending that people have problems with.

As far as I know, that's a direct violation of the Balanced Budget Amendment. Even Republicans like Sen. John McCain have major problems with the Bush Administration's spending spree.

--
"I drank what?" - Socrates
Re:First to say - Well Done by madpierre · 2004-02-18 08:40 · Score: 1

Hmmm. Mixing ones metaphors. Bad.

A millstone hanging round ones neck.
Hanging over them like the sword of Damocles.

Need more caffine.

--
siggy played guitar
Re:First to say - Well Done by Fred+Ferrigno · 2004-02-18 08:40 · Score: 1

In fact, with all the poverty, institutionalized corruption, and a nuclear war in the making, some Indians are saying now that India was better off under British rule.
Re:First to say - Well Done by That's+Unpossible! · 2004-02-18 08:42 · Score: 1

I know this may damage your "NPR mind," but how about the novel concept of 'cut taxes AND spending'?

--
Ironically, the word ironically is often used incorrectly.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 08:49 · Score: 0

The caste system, as it exists today (far more stratification of the social hierarchy), was a direct result of the British occupation. Also, the current situation between Pakistan and India is arguably the result of the British occupation. The British were masters at the strategy of 'divide and conquer', and they were quite successful in carrying it out in India.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 08:58 · Score: 0

Debt isn't an inherently bad thing.

Let me guess, you're Jewish?
Re:First to say - Well Done by LookSharp · 2004-02-18 08:58 · Score: 1

That's right, because everything is conveniently bucketed into "Democrat" and "Republican." It's easy when 90% of your principles come from which of the two labels you stick on your chest when you go campaigning.

***This thread is veering offtopic quickly, so I'll let you partisans have your way with eachother. Us cynnical folks with disdain for party politics and lovers of logic and compromise will swill another beer and grumble incoherently about the coming days where only the morons vote, and only vote how their party tells them. Like in about... 8.5 months.
Re:First to say - Well Done by cayenne8 · 2004-02-18 08:59 · Score: 1

I'm not rich...and I still like my tax cut. I just don't like the way the Rep.s have kept spending.
I'm more of cut tax collection AND cut spending....

--
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Re:First to say - Well Done by mjpaci · 2004-02-18 09:12 · Score: 3, Informative

The interest on that $7,000,000,000,000 in debt is going to hard working Japanese people who find the returns on T-Bills to be a lot higher than what they could get at their local bank.
Re:First to say - Well Done by JWW · 2004-02-18 09:15 · Score: 1

Cut spending???? What are you crazy?? ;-)

Of course I haven't heard a single person running for any office actaully talk about cutting spending.

Hell, my senator had a pair of sound bites that were really interesting. In one he complains about how much Bush is spending and how high the debt is, and in the other he complains about how his pet projects here at home didn't get enough funding.....
Re:First to say - Well Done by frodo+from+middle+ea · 2004-02-18 09:20 · Score: 1

it did little permanent damage, at least in India.
Yes , very little damage, except sow seeds of communal hatred amongst the hindus and muslims, and partition the country in three pieces and lead to communal roits which left millions dead, and create so much hatred amongs the Indians and Pakistanis, that a Nuclear program is considered a Key acchievement in the country's growth ,when Half the country is hungry.
The british and british alone are responsible for half the problems of the current world.
The relocation of Indian Tamils to Sri Lanka, has left that country in a Civil war for last 30 years.
The relocation of convicts to australia, has systematically destroyed the aborigins.
The partition of lands in africa, which left so many tribes half divided in various countries, leading to so many bloody civil wars...
need I go on...

--
for the last time people, I am "frodo from middle eaRTH", not "middle eaST".
Re:First to say - Well Done by 4of12 · 2004-02-18 09:30 · Score: 2, Informative

...Spain that did the same thing and didn't become sucessful

Incorrect.

Spain was quite successful in the 1500's, otherwise known as the Siglo de Oro, or century of gold built up from their, uh, ventures in the New World.

At the time they were considered a pre-eminent world power. The British were quite nervous about the might of the Spanish Armada when they attacked in 1588, but were fortunate in that the Spanish fleet had to contend with a series of bad weather at inopportune times.

--
"Provided by the management for your protection."
Re:First to say - Well Done by be-fan · 2004-02-18 09:30 · Score: 1

The caste system has little to do with British occupation. Indeed, British occupation helped to weaken the caste system as it existed. And the current situation between India and Pakistak occurred *after* India got its independence. It has more to do with nationalist concerns than the British playing one side off the other.

--
A deep unwavering belief is a sure sign you're missing something...
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 09:31 · Score: 1, Informative

No, sorry to burst your conservative-fantasy bubble, but you are a moron.

You say income tax revenues increased by 99.1% the next year after the Reagan tax cuts? Check the facts. The personal income tax rate cuts were phased in during 1982 and 1983. Personal income taxes raised $286 billion in 1981, $298 bn in 1982, $289 bn in 1983, and $298 bn in 1984. Corporate income tax revenues were $61 bn in 1981, $49 bn in 1982, $37 bn in 1983, and $57 bn in 1984.

Gee, that 99.1% sounded so authoritative with the decimal place and all, but it's total fabrication.

Besides, the supply-side economics mythology conveniently forgets that Reagan had to repeal about half the business tax cuts with the Tax Equity and Fiscal Responsibility Act of 1982. Also included was a massive increase in Social Security payroll tax rates. Those revenues rose from $183 bn in 1981, $201 bn in 1982, $209 bn in 1983, $239 bn in 1984, $265 bn in 1985.

I absolutely agree that going into debt to finance investment is a great idea, provided that you actually finance investment, but the idea is that your investments repay the debt and leave you better off. Instead, Reagan, Bush, and little Bush gave us perpetually increasing debt.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 10:15 · Score: 1, Funny

Not to mention the Germans who didn't even manage to colonise anyone at the time.

Well, other than France, that is.

--Greg
Re:First to say - Well Done by Tiro · 2004-02-18 10:29 · Score: 1

I was going to critisize you on your political economy argument, but damn if it isn't solid and factual. Well said.
Right now Apple, with the amount of cash it has right now, has no reason to hold debt, so not paying off all debt would have been eating into profits, albeit not horribly...
Re:First to say - Well Done by isa-kuruption · 2004-02-18 11:24 · Score: 1

You are correct, although you're too much of a coward to receive affirmation. I was wrong in stating "from the previous year", when I should have said "in the following decade".

In 1981, the TOTAL federal revenue was approximately $1 trillion. As you noted, the tax cuts occured in 1982. By the time the 1980s were gone, the tax cuts raised approximately $1.2 trillion dollars in revenue in the 1980s. (You can go Here (specifically look at the chart). This was a direct result of the tax cuts.

You may also want to check out this page which is labeled 'economics 101'. Some interesting facts:

1) These additional federal tax revenues contributed to the reduction of the federal deficit from 6.3% of GDP in l983 to 2.9% in l989
2) From l982 to l989, l9 million net new jobs were created in the United States (more than the number of jobs created in Europe and Japan combined), two-thirds of them high or middle paying, resulting in the lowest unemployment rate in l6 years.
3) Real family income increased every year from l983 through l990 in every income group (from the poorest fifth of households to the richest fifth).
4) 86% of the tax filers in the poorest fifth of families in l980 moved out of that bottom quintile by l988 (l6% moved all the way to the top fifth of income earners).

Also of interest is this site which talks about the Reagan cuts. Interesting enough is the chart which shows that the tax burdon increased for the highest wage earners while decreasing for the lowest wage earners. And a quote, " The share of the income tax burden borne by the top 10 percent of taxpayers increased from 48.0 percent in 1981 to 57.2 percent in 1988. Meanwhile, the share of income taxes paid by the bottom 50 percent of taxpayers dropped from 7.5 percent in 1981 to 5.7 percent in 1988."

Those supply-side economics... wow, such a terrible thing. Worked twice before and yet you refuse to learn from history.
Re:First to say - Well Done by LPetrazickis · 2004-02-18 13:02 · Score: 1

This still compares favourably with countries like France and Spain that did the same thing and didn't become sucessful :-)

By what standard is Britain successful and France strictly unsuccessful?

Not to mention the Germans who didn't even manage to colonise anyone at the time.

Other than Cameroons (Kamerun), Caroline Islands (Karolinen), German East Africa, German New Guinea, German South West Africa, Kiautschou, Mariana Islands (Marianen), Marshall Islands, Samoa, and Togo.

--
Is this a sigs-optional kind of place? 'Cause I am totally down with that if you know what I mean.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 13:56 · Score: 0

Of course, it doesn't hurt to colonize numerous less powerfull nations, systematically remove all profit and natural resources, then "benevolently" grant said colonies their independence when everything of value is gone and they're no longer profitable to the empire. Just ask the Indians and north Africans...

What a joke! Were it possible, Britain would have loved to hang on to its colonies rather than grant them independence. Witness the ferocity with which it fought to retain the Falkland Islands, and the futile desperation with which it tried to extend its influence in Hong Kong. But two world wars (fought precisely over colonies) and a new era of "human rights" made such an empire impossible to maintain, both militarily and morally.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 14:49 · Score: 0

Take off the ideological blinders. The whole notion that cutting tax rates will raise revenues (via generating growth) is based on the "Laffer curve," which is ingrained in supply-side religion. The idea behind the Laffer curve is that the government raises no revenue when tax rates are 0% or 100% (since nobody would work). Some tax rate in between thus is the revenue-maximizing tax rate for the government. Supply-siders believe that we are on the wrong side of that maximum, so that lowering the tax rate raises revenues. A nice idea, but no reputable economist has found any evidence that this is true.

After all, what happened after Bill Clinton's "largest tax increase in history"? Republicans claimed it would cause a recession, slow down growth, blah blah blah. If we were on the wrong side of the Laffer curve, they might have been right. Instead, the deficit was eliminated and massive surpluses were generated. So, who is failing to learn from history?

The chart from the Heritage Foundation provides absolutely zero evidence to support your claims. Yes, overall government revenues were 28% higher in 1990 than 1980, but it is absurd to insinuate that *all* the growth in the economy since 1980 came *only* because of the Reagan tax cuts. Besides, you completely ignored the point that in 1982 Reagan passed a very large tax increase in the form of increased Social Security payroll taxes. Adjusted for inflation, that tax increase was larger than Clinton's in 1993.

It is utterly wrong to believe that massive borrowing has no consequences. When the federal government borrows money, it floats Treasury bonds and thereby soaks up investment capital that otherwise could be used in productive activities. Next year alone that will be $500 billion. As the federal government competes for investment dollars, interest rates will rise and the cost of raising capital will rise for businesses as well.

Besides, there's also the cost to future generations. We now have a federal debt of nearly $4 trillion, two-thirds of which was run up during the Reagan, Bush 1 and Bush 2 administrations. Interest payments this year will be $156 billion (and that's actually quite low due to the low cost of borrowing at the moment -- in 1997 we paid $244 billion in interest on a debt level that was lower than today's). All that supply-side ideology leaves us with greater government burden in the future, not exactly what supply-siders have in mind, I expect.
Re:First to say - Well Done by Anonymous Coward · 2004-02-18 16:46 · Score: 0

It's 'rationale' dipshit.
Re:First to say - Well Done by Shisha · 2004-02-19 00:03 · Score: 1

Sorry guys I was just trying to make a not too great joke. I clearly failed, being moderated as interesting! What I said was not interesting it's mainly rubbish, as you are mostly correctly pointing out.

By what standard is Britain successful and France strictly unsuccessful?
Well actually to answer this one: not overrun by Germans in the 1st and 2nd World Wars? Spreading their language so that it became _the_ language to know outside your own country? Think about it: I'm Czech and I can speak reasonable German. But I talk to my German friends in English, because overall it's easier. I talk to my Spanish friends in English and not say French. Heck I even talk to Polish people in English even though Czech & Polish are so similar that people actually understand each other when they speak slowly.

Other than Cameroons (Kamerun), Caroline Islands (Karolinen), German East Africa, German New Guinea, German South West Africa, Kiautschou, Mariana Islands (Marianen), Marshall Islands, Samoa, and Togo.

Compare this to Canada, India (that included Pakistan and Bangladesh), Australia, New Zealnd, Iraq, Iran and Hong Kong. (should have said "Germans never managed to colonise _almost_ anyone, or maybe "Germans who didn't even manage to colonise anyone at the time, almost surely" depending whether people prefer probability terminology or integration theory terminology).
Re:First to say - Well Done by Saint+Mitchell · 2004-02-19 01:04 · Score: 1

Wouldn't damage it at all. I'm all for cutting spending. You can't spend more than you take in, it's as simple as that. Were it up to me I would have not cut taxes on capital gains so we could help pay down our debt. The whole point for this tax cut was to get people to put money back in the market. Sure it's up, but who cares. My 401K is still worth less than I put in.

It's either that or print a shite load of money to pay it off and go the way of Germany circa WWI. I don't know about you, but the thought of our money being so worthless that we can burn it to keep warms doesn't sound like a good idea. That's what the current administration is doing. Printing to pay our debt. Seldom a good idea.
Re:First to say - Well Done by MarcQuadra · 2004-02-19 16:02 · Score: 1

I'm not rich either, and my tax cut was $1.53/week.

What the FUCK am I going to do with $1.53 a week? It's NOTHING to be excited about if you're like me and work a decent 40 hours for under $35K/year.

I'd rather have that money doing something useful for me, like paying for my school or making sure I'll be able to afford a doctor if I get laid off.

--
"Sometimes, I think Trent just needs a cup of hot chocolate and a blankie." -Tori Amos on Nine Inch Nails

$4.8 billion by UberChuckie · 2004-02-18 07:10 · Score: 5, Informative

Is that cash reserves or for daily operation? Huge difference.

Re:$4.8 billion by samsmithnz · 2004-02-18 07:21 · Score: 1

Daily operation? I think you mean Cash Flow.

I doubt that is money in the bank though, otherwise they would have paid off that measly 300 million years ago...
Re:$4.8 billion by eln · 2004-02-18 07:23 · Score: 1

I would hope it means cash reserves, as it's nearly impossible for a company of any sufficiently large size to be able to tell with any accuracy how much cash they have in the bank for daily operations at any given moment. Any number they put out on that would be little more than a guess.
Re:$4.8 billion by tyrione · 2004-02-18 07:24 · Score: 5, Informative

Get serious. It's cash reserves, collecting Bank interest.

Daily operations of $4.8 Billion would make zero sense due to the fact it takes them 6 months to generate that much in gross sales alone.
It would be quite difficult to claim zero debt now wouldn't it?
Re:$4.8 billion by macMaestro · 2004-02-18 07:26 · Score: 1

Cash reserves.
Re:$4.8 billion by I8TheWorm · 2004-02-18 08:02 · Score: 1

Apple has $4.8 billion in total assets

Total assets are a far cry from cash, and include land/improvements, office equipment, machinery, etc... as well as cash. Also included would be investments in other companies, which Apple has been known to do.

--
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
Re:$4.8 billion by sakusha · 2004-02-18 08:18 · Score: 1

Last time I checked, Apple had over $3billion in cash reserves. Most of that money came from consumer financing deals with GE Credit Corp, in the 1980s before GECC folded. Apple bought out the financing deals at fire-sale prices, which enabled them to accumulate HUGE cash reserves. Now Apple uses MNBA for consumer financing so the cash isn't quite rolling in like it used to.
Re:$4.8 billion by I8TheWorm · 2004-02-18 08:23 · Score: 1

That would be a different story, as $3BB is a hefty amount of cash. However, out of that comes things like salaries, bulk payments to health care providers, lease on office space (if they don't own their building), federal filings, etc...

Given all of that, it's probably still a hefty chunk of change and leaves them in a nice position for marketing and/or R&D.

--
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
Re:$4.8 billion by sakusha · 2004-02-18 09:44 · Score: 1

OK, I checked around more, because the last time I checked and saw the $3B figure was a couple of years ago. Both Forbes and Mercury news are confirming the $4.8B figure as cash reserves, not total assets. The guy who says the $4.8B figure includes all assets was reading the 10-Q incorrectly, he's wrong. Apple accumulated astonishing amounts of cash in the 1980s and early 90s.
Re:$4.8 billion by I8TheWorm · 2004-02-19 01:19 · Score: 1

Sounds like you did more research than I did... all I read was a summary of the filing. 4.8 is an astonishing amount of cash... I'd love to know (this time I searched more and couldn't find it) what Apple's annual payroll and fixed expenses are. I'm sure they're far less than the 4.8, leaving Apple in a bad tax/finance situation, but a great position for spending on things like R&D, ramping up development, etc...

--
Saying Android is a family of phones is akin to saying Linux is a family of PCs.

is that a good thing? by Nathan+Brazil · 2004-02-18 07:10 · Score: 5, Interesting

With interest rates as low as they are right now, shouldn't they be borrowing and investing more in the future, or some such economic technobabble like that? Cash in the bank can't be giving them as much growth as investment would...

Though cash in the bank is very safe, at least.

--
echo Prpv a\'rfg cnf har cvcr | tr Pacfghnrvp Cnpstuaeic

Re:is that a good thing? by Ranger96 · 2004-02-18 07:14 · Score: 5, Interesting

Even more to the point, if the interest Apple was paying on the debt was lower than the return they could make investing the $300M, then (everything else being equal), this wasn't the best use of their cash.

However, there are too many variables for a non-insider to really know. Most companies have finance people who are at least competent enough to make these kinds of decisions. This is Finance 101 stuff.

Chris

--
What has been will be again, what has been done will be done again; there is nothing new under the sun.-Ecclesiastes 1:9
Re:is that a good thing? by MoonBuggy · 2004-02-18 07:16 · Score: 1

Last I checked, it was good to be out of debt if interest rates were high. Now they don't have that debt to worry about they can invest the remaining money however their accountants advise.
Re:is that a good thing? by CrazyLion · 2004-02-18 07:29 · Score: 1

Being debt free isn't necessarily good. A public company without debt is financed entirely by equity, which is more expensive than debt. Shareholders generally expect higher return on their investment than bondholders.
With higher cost of capital Apple will have to make sure that their projects generate higher return on money they invest into them. As a result Apple may have to forego some projects, which they would've chosen to pursue have they had lower cost of capital.
Re:is that a good thing? by MoonBuggy · 2004-02-18 07:34 · Score: 1

Err, could you explain that in simpler terms? I just thought that it's good to get rid of the debt so if rates were to go up they have nothing to worry about. I'm not an economist though, so it looks like I missed something.
Re:is that a good thing? by TopShelf · 2004-02-18 07:49 · Score: 1

One example is that a company can deduct debt interest as a business expense, so it reduces the tax bill.

Also, there's the opportunity cost to consider. Do you spend your money paying off a 7% loan, or put it into a project that provides a 25% payoff? This move could be a sign that Apple doesn't see many great projects in the near future...

--
Stop by my site where I write about ERP systems & more
Re:is that a good thing? by CrazyLion · 2004-02-18 07:51 · Score: 1

Let me try :-)

Just because Apple got rid of debt doesn't mean that Jobs and the gang own all company assets. Everything (including those 4.8BB in cash) is owned by Apple shareholders (people who own Apple stock). Shareholders in turn want to make money - be that in the form of dividends or in the form of stock appreciation.

Shareholders take more risk than bondholders do, since there is no promised payoff. If Apple fares poorly, shareholders lose their investment without any legal recourse. Since shareholders take more risk, they want to earn more than bondholders on their investments. Meaning that they expect Apple to make more money than bondholders did.

Since all of Apples capital now comes from equity financing (stock), they have to make enough profit to meet shareholders expectations.

The good news for Apple is that there's no rigid schedule of payments they have to meet (like they do with debt). The bad news is that they have to earn more or shareholders would get upset.
Re:is that a good thing? by geoffspear · 2004-02-18 07:54 · Score: 1

And do you really think their credit rating is so poor that they can't take on another $300 million in debt if they want to?
Although I suggest you buy a share and bring up a shareholder resolution to fire the CFO and replace him with yourself, so everyone can laugh at you.

--
Don't blame me; I'm never given mod points.
Re:is that a good thing? by OwnedByTwoCats · 2004-02-18 07:57 · Score: 2, Insightful

Borrowing to "invest in the future" makes sense if you know how to spend the money now in ways that will guarentee a return in the future.

A lot of companies have borrowed money, and spent it, and failed on the ??? step, so they didn't have the profits, so they're bankrupt.

Interest on borrowed money is an expense that Apple has eliminated. Good for them!
Re:is that a good thing? by larry+bagina · 2004-02-18 08:15 · Score: 1

The debt was at 6.75%. that means you need to find a 10% pretax rate of return. You can get a rate of return that high, but it involves a lot more risk than any prudent corporation would take, and is subject to short (and long) term losses.

--
Do you even lift?
These aren't the 'roids you're looking for.
Re:is that a good thing? by lenhap · 2004-02-18 08:35 · Score: 1

While it is completely true that financing a business with debt will usually allow for greater returns, in Apple's case, this would not make any sense.

Using debt is only good if you have investments to spend the money one. Apple has many investment opportunites, but do you really think they have $4.8 billion dollars worth of investing they can do inside their own company?

The $4.8 bil in "cash" that Apple has is not sitting in some bank somewhere. Apple actually has that money invested. And since Apple has all of the $4.8 bil invested, it makes no sense to keep $300M in debt. Now as I said before, they could not possible invest $4.8 billion in their own company, can you imagine being R&D with a budget of $4.8b? Rather they use the $4.8 billion to invest in other companies. They generate a lot of profit by using the money to loan out to other companies.

So while they front as being one of the best computer companies, they actually generate as much profit essentially being a bank to other companies. If you take a look at Apple's financial filings, it shows where all this money is being used and invested.

Hey whatever keeps the money coming in so they can keep making cool hardware and software...
Re:is that a good thing? by spood · 2004-02-18 09:37 · Score: 1

Even more to the point, if the interest Apple was paying on the debt was lower than the return they could make investing the $300M, then (everything else being equal), this wasn't the best use of their cash.

A good point, except for the fact that the debt was in the form of bonds that came due this month. They didn't have any choice but to pay them off.

--
---- Just another spud server.
Re:is that a good thing? by cheekyboy · 2004-02-18 09:39 · Score: 1

If they put 4.8billion of USA into Australia 6months ago at an exchange rate of .60 and at 4.75% interest rate, and transfered it back today at .80, they would get at least 6.5billion back today. Same sort of return if they bought gold, but its hard to buy that much worth even on paper trades, since your trade would cause a market shift.

Now dont say that, "oh how can you predict that 6months ago"

Note, go to www.financialsense.com , and if you listen to its FSN radio broadcast from say, DEC 2002 I think it was, I did ask a hypothetical question on 'borrowing' millions in USA funds and transfering to AUST banks, and paying it back via interest paid in AUST returns + currency growth, and bang, make a profit for nothing by 2004 after the 40% gain in currency strength.

Any 1/2 smart person would have predicted that if their heads arent in the asses about how great the USA$ is.

Warren buffet even thinks the USA$ will tank, he did transfer into EUROs and buy $100m in silver too.

--
Liberty freedom are no1, not dicks in suits.
Re:is that a good thing? by cheekyboy · 2004-02-18 09:43 · Score: 1

Just like those $300k paid accountants/managers at ENRON CORP.

Did'nt stop them from stupidity.

Not that apple would ever buy $300m in GOLD or SILVER and witness a 40% rise in the real gain in 12months would they.

No financial wizard would do that, even tho its a real gain, but they would dump $300m in shares that are high risk coz it looks 'smart' not 'old world'.

www.financialsense.com and www.gata.org for your delights.

--
Liberty freedom are no1, not dicks in suits.

Lets see... by FortKnox · 2004-02-18 07:10 · Score: 4, Insightful

The crashing success of iTunes, and iPods? Along with OS X and the resurgence of the iMacs? I don't think its that hard to accept that they are now in the black.

--
Good quote, too many chars. Seriously, the slashdot 120 char limit sucks!

Re:Lets see... by Anonymous Coward · 2004-02-18 07:13 · Score: 0

Yes and how about their market-share dwindling to 1.8%?
Re:Lets see... by SpamJunkie · 2004-02-18 07:17 · Score: 5, Insightful

This isn't being in the black. Being in the back means being profitable and they've been profitable long before now. This isn't a sign of business strength either, since many companies keep some debt around just so they have some flexibility when it comes to reporting their financials.

This is more of a business decision to run a debt-free company. With 4.8 billion cash on hand they could have been debt free before now.
Re:Lets see... by ryanw · 2004-02-18 07:22 · Score: 3, Interesting

Actually... as long apple stays in business, I could careless what their market share is. I know between my house and my inlaws house's it's in the upper 70% ratio of macs to pcs. Ever since I got a mac I have convinced them to go the same way. This has reduced the "friendly inlaw house calls" down to about 1 every 6 months instead of one every few weeks.
Seriously! You ever get stuck making house calls to fix friend's computers? Ever since I've convinced people to go mac they've been more functional (making dvd's, photo albums, burning CD's, No Email viruses) and I get almost no calls from friends asking for help. They don't have the same issues as with Windows or even worse would be linux.
Re:Lets see... by fullofangst · 2004-02-18 07:27 · Score: 1

As far as I am aware, Apple make practically no money on iTunes. In fact, I think it's literally break even. All the profit goes straight to our good friends at the RIAA. Hardware sales are presumably where the money comes from.
Re:Lets see... by MakoStorm · 2004-02-18 07:29 · Score: 1

I have to say, I love itunes, and will make it my primary way of buying music. I just wish they would add type-o-negative to their store.

Apple would have a lot more of my money if they could lower their prices a bit. I want an eMAC so bad, and an Ipod, but right now with no job I cant afford them, and chances are when I do get a job they would be a little out of my price range.

Steve, I am telling you dude, if you could lower the prices on a few of your products you would have my money quick. You already have me hooked on itunes. Please make itunes for linux would ya? And if you don't release for linux, how about making the current eMAC like 500 bucks?
Re:Lets see... by Scorpio+Blake · 2004-02-18 07:37 · Score: 1

I'm exactly in the same boat. I would love to buy an Apple, probably a 15" powerbook, but the prices are just so high that I can't justify it. Not to mention I'd have to buy Photoshop as well, at Adobes obscene price. I just wish they were a bit more competitive in their pricing. =(
Re:Lets see... by 11223 · 2004-02-18 07:40 · Score: 5, Informative

You know, I keep hearing this crap about iTunes and the RIAA, and it's time that somebody put a stop to it.
I just bought five albums on iTunes. Not one of them was on an RIAA label. One of the labels I bought from is owned by the artist himself (Pete Namlook's FAX label). The others were similar independent labels (Ninja Tune and Tresor). There is non-RIAA music on iTunes in spades, and I will continue to buy from them.
Re:Lets see... by Anonymous Coward · 2004-02-18 07:47 · Score: 0

wtf kind of world do when live in when its better to be in debt than to be profitable and debt free.....
Re:Lets see... by Anonymous Coward · 2004-02-18 07:57 · Score: 0

Would you leave that poor dead horse alone for at least ONE Apple-related article? Did you know that it's possible to increase sales AND profits and still lose market share? It's only a ratio, it's not a valid indicator of a company's profitability.
Re:Lets see... by claygate · 2004-02-18 08:17 · Score: 2, Interesting

"There is non-RIAA music on iTunes in spades, and I will continue to buy from them".

I don't know if you are most qualified to answer for me but doesn't the RIAA still get money from each sale? My assumption that they do might be wrong but the assumption that they would have signed a contract with Apple without a blanket percentage scheme sounds unlikely. Anyone have an answer to this?
Re:Lets see... by Llywelyn · 2004-02-18 08:34 · Score: 1

Just buy from labels that aren't with the RIAA. Easy.

http://www.magnetbox.com/riaa/

--
Integrate Keynote and LaTeX
Re:Lets see... by nelsonal · 2004-02-18 08:37 · Score: 1

At least on average the majority of the profit (if not most of the revenue) goes to the record label that owns the copyright to the music be they RIAA afiliated or not. I'm not sure if the terms are very different between indie labels and major labels on the revenue split with Apple, but would assume them to be similar. Suffice to say that for the average purchase the record label gets most of the money, while apple gets enough from that sale to cover advertising, development, bandwidth, serving, and other costs associated with iTMS. However, they are much more likely to sell an iPod that makes Apple a ton of money.

--
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.
Re:Lets see... by Anonymous Coward · 2004-02-18 08:38 · Score: 0

You have no job, As long as an iMac costs more than $0, you won't be buying one.
Re:Lets see... by currychicken · 2004-02-18 08:44 · Score: 1

Macs are quite pricey... mostly due to that "cutting edge" hardware push that the company has followed in recent years. If you're looking for a decent priced Mac, try your local used computer shop or Ebay. A G4 with a little extra ram can go a long, long way.
Too bad OS X is beginning to act like MS oses... while it's a beaut, its beginning to put on a little weight. Come on Jobs! You're out of debt, now how about we get OS X in shape and drop a few pounds! (I wonder if these were his New Years resolutions?)
As for linux. And there's always Yellow Dog and Gentoo!
CC - curried chicken for the soul.
Re:Lets see... by ajna · 2004-02-18 08:45 · Score: 1

Ever since I've convinced people to go mac they've been more functional (making dvd's, photo albums, burning CD's, No Email viruses) and I get almost no calls from friends asking for help.

Maybe that's because your friends all deserted you when you started evangelizing for Apple?
On a more serious note, I agree with the parent post: I'm happy as long as Apple cranks out a sufficient number of machines to satisfy the computing needs of my family and friends. And with their healthy pile of cash and consistent profits I have no fears for the immediate future.
Re:Lets see... by shawnce · 2004-02-18 09:06 · Score: 5, Informative

The RIAA cannot get money from an artist or company that is not member. The RIAA is NOT a record company but a trade group whose main goal is to represent the U.S. recording industry (the record companies, artists, distributors, etc.). Its mission is to protect the right of artists, etc.

I believe membership fees for the RIAA are based on gross revenues... ahh this outlines it.

In some ways the RIAA is like the ACLU, almost everyone hates it at some point until it is defending a constitutional right that they care about.

-Shawn
Re:Lets see... by MoneyT · 2004-02-18 09:11 · Score: 1

They may not anymore, but Adobe used to do crossgrades for the price of an upgrade.

--
T Money
World Domination with a plastic spoon since 1984
Re:Lets see... by dasmegabyte · 2004-02-18 09:42 · Score: 1

Holy shit, iTunes has Ninja Tune!?!

It does! There's King Geedorah's "Take me to your Leader!"

Time to cash in those pepsicaps!

--
Hey freaks: now you're ju
Re:Lets see... by G-funk · 2004-02-18 11:58 · Score: 1

Erm, they get some money when you buy a cassette, wether you're using it for priated music or not... And soon they'll get it for cds as well.

--
Send lawyers, guns, and money!
Re:Lets see... by shawnce · 2004-02-18 12:12 · Score: 1

How much is "some" and any reference you can point out?

I am curious.
Re:Lets see... by Anonymous Coward · 2004-02-18 13:29 · Score: 0

I know this is hard for a long time mac user to understand, but....

Some of us run Linux on X86 and PPC platforms. We couldn't care less if the machine is a Macintosh or not. There is no inherent advantage to either hardware setup.

I run multiple versions of Linux, Windows, DOS and MacOS around here. I have found three things that I hate: 1.Mac OSX...its the slowest OS I have ever seen despite that they put it on some decent hardware. 2.Macintosh machines with Motorola 68040 chips...particularly the LC chips. There is ALWAYS some issue to overcome. (flaky proprietary hardware schemes really come to mind...remember nubus?) 3.Any version of Windows that hasn't been picked apart by software from LitePC. I don't have any affiliation with them, but they do make MS Windows a lot more tolerable.

The whole concept of Mac vs. PC is stupid from my perspective. Windows sux...no doubt about that. Just dont hand me that Mac is great garbage. Every version of MacOS before OSX is very limited. OSX would be fine if it didnt have a ton of lead in its pants.

As far as linux goes...if you can't handle it, stay out. Nobody is forcing it on you. When you are ready to learn something, go get yourself a copy of Gentoo and put in an Imac. You might be surprised at how fast it runs when you do. Heck, even Debian for that matter.

While I'm bashing everyone anyway...Not putting a floppy drive on the Imac has got to be one of the stupidest moves Apple has ever made. It reminds me of that "everyone will be on broadband anyway" statement that some moron made quite a few years ago.
Re:Lets see... by Col+Bat+Guano · 2004-02-18 15:27 · Score: 1

Maybe -you- should ring -them- every now and them to talk about the viruses that they aren't having. Nothing like reminding people just how lucky they are.
Re:Lets see... by PantsWearer · 2004-02-19 02:00 · Score: 1

While I'm bashing everyone anyway...Not putting a floppy drive on the Imac has got to be one of the stupidest moves Apple has ever made. It reminds me of that "everyone will be on broadband anyway" statement that some moron made quite a few years ago.
My floppy drives have done one thing in the last five years: gathered dust. All my machines can boot from CD. I've had a CD burner for the last five years, so if I need to make a bootable CD, I can (though I've never needed to).
My wife got a Powerbook about 5 years ago, it was the first computer I had that didn't come with a floppy drive. We got an external USB floppy for it so she could move data from an unnetworked PC (which at the time was already 5 years old) to it. Since she stopped doing research there, we haven't used it at all. In fact, at this point, I'm not even sure where it is.
The only machine that I have in my house that has a floppy drive is my PC. It's never been used. All the emergency software for it is on CD. It has a burner, so if I need to, I can burn backups and such.
Truthfully, not only are floppies fragile and bit rot prone, but they hold nearly nothing in today's world. So they can't even be used for quick "sneaker net" transfers anymore. I can't remember the last time that I need to transfer less than 5 megs from one computer to another. At my place of work, there are word docs that would easily swamp a floppy.
Currently, my "sneaker net" is powered by a single USB zip drive. When I need to move something, I just write it to disk and then move the whole unit to the new machine (everything I own has USB ports). Now that I think of it, I've never had to use it either, since I have a robust home network attached to a cable modem.

--
Be glad life is unfair, otherwise we'd deserve all this.

Witness... by crushinghellhammer · 2004-02-18 07:10 · Score: 3, Insightful

the birth of the next corporate monster...now totally unfettered by the chains of debt

Re:Witness... by Anonymous Coward · 2004-02-18 07:17 · Score: 1, Insightful

Apple is well fettered by the chains of their own snobish elitism, the cult of Jobs, and a cowardly management.

Otherwise they would be selling Mac OS X for the Intel platform at $199.99, and we linux users would have to shit our pants and start writing quality code because we wouldn't be competeing against just Windows any more.
Re:Witness... by MuckSavage · 2004-02-18 07:25 · Score: 2, Funny

As an elitist, snobbish, cult-of-Jobs follower, I am offended by your statements.
Re:Witness... by pelorus · 2004-02-18 07:32 · Score: 1

It still wouldn't be Free which means that Linux users with character woudn't use it anyway.

And as it wasn't free, the rest of the Linux users wouldn't use it (legally).

Flame away...
Re:Witness... by Anonymous Coward · 2004-02-18 07:35 · Score: 0

Amen to that, brotha!
Re:Witness... by Frankensloot · 2004-02-18 07:58 · Score: 0

As a Mac user, I was offended by this at first. But then I realized: why should I care what a prole like you thinks?
Re:Witness... by Anonymous Coward · 2004-02-18 08:03 · Score: 0

if theres to be a future, it lies with the proles.
Re:Witness... by Gherald · 2004-02-18 08:06 · Score: 5, Insightful

Mac OS X for x86 would suck. Unless they put a lot of money into driver support or emulation of Win32 drivers, which is risky and inelegant.

The reason why OSX "just works" on Apple computers is because Apple has complete control over the hardware.

The x86 world is so heterogeneous that if an OSX for x86 was released, it would have so many compatibility problems that Windows XP would look elegant by comparison.

And before you say "If Linux can run well on the desktop OSX should be able to as well", the answer is NO, Linux does not work well as a desktop platform yet precisely because of all the unsupported hardware and software.

And before you say "OSX has a fairly large number of commercial software availeable that could give it an edge over Linux as an alternative x86 desktop", the answer is NO, all that software would have to be redesigned, recompiled and retested for x86 which would take a very LONG time.

You OSX-for-x86 folks are so naive, it ceased to be funny a long time ago.

Apple's current business model of making their own hardware _AND_ software is working very well. It is the only way they can stay alive in a Redmond dominated world, and still compete with free (libre) alternatives like Linux.

--
The unofficial /. digest
Re:Witness... by Bendebecker · 2004-02-18 08:07 · Score: 3, Insightful

Actually from what I understand, trying to break into the x86 market woudl be a disaster for apple since they supposedly make most of their money not ont eh oS but on the hardware. Plus, with only apple certified devices (namely apple computers) to keep in mind, Mac OS is a lot more stable than say releasing it to the intel family of chips. By keeping Mac OSX limited to proprietary hardware, they don't have to deal with a lot of the satbility issues that plague windows. In other words, the systems greatest benefits come from a stability granted by limiting the computers it can run on and not having to worry about hardware form 3rd party vendors.

--
There's a growing sense that even if The Future comes,
most of us won't be able to afford it.
-- Lemmy
Re:Witness... by Anonymous Coward · 2004-02-18 08:07 · Score: 0

You realized that too late, sucker. You were offended because it's true.
Re:Witness... by Anonymous Coward · 2004-02-18 08:12 · Score: 0

Debt didn't stop SCO
Re:Witness... by mbbac · 2004-02-18 08:36 · Score: 1

Before making such a bold statement, name two companies that have succeeded selling an operating system.

--
mbbac
Re:Witness... by larry+bagina · 2004-02-18 08:45 · Score: 1

I partially agree, and even more importantly, so does history.
Before OS X, NextStep and OpenStep were available for x86 hardware. They provided a nice gui and Unix stability when the rest of the world was using windows 3.1.
But they were fickle about hardware and interrupts.
I don't know why OpenStep for x86 wasn't more popular. Maybe it was too expensive. Maybe it wasn't MS. Maybe NeXT didn't advertise enough. I don't know any reason OS x86 wouldn't suffer the same fate.

--
Do you even lift?
These aren't the 'roids you're looking for.
Re:Witness... by prockcore · 2004-02-18 08:45 · Score: 1

Mac OS X for x86 would suck.

Hate to say it, but you're right. Look at the few apps that Apple has written for the x86, (iTunes and Quicktime). Both are memory hogs and buggy. Apple has no ability at all to write software for the x86.

OSX is already a ram hog.. porting it to x86 would only make it worse.
Re:Witness... by Anonymous Coward · 2004-02-18 08:52 · Score: 0

Before making such a bold statement, name two companies that have succeeded selling an operating system.

Microsoft
Wind River
TRON - article on ITRON

That's three.. what were you saying now?
Re:Witness... by Gherald · 2004-02-18 09:37 · Score: 1

You make some interesting points, but let me respond to a few that I think are false:

Your protestations that a huge amount of work would have to be done to port everything over to x86 simply betray that you haven't written code to compile cleanly on multiple systems.

Actually, I personally *have* written code that compiles cleanly on multiple systems. It is the people who make commercial Apple software that presumably *have not* written portable code.

> All the applications that Apple depends on were originally written for the real computer market -- MS Office, Adobe, etc, and ported only as a way of squeezing a few more sales out of them.

Granted, but you are ignoring the fact that the original code written for x86 does not use Cocoa or whatever other GUI/API's OSX for x86 would offer.

Now suppose it would take 6 months to port something like MS Office or Photoshop to OSX-on-x86.

Even ignoring the obvious conflicts of interest, do you think companies like Microsoft and Adobe are willing to spend time, money, and effort to re(design,compile,test,market) their products when Windows is the de facto x86 standard? Hell no.

--
The unofficial /. digest
Re:Witness... by Anonymous Coward · 2004-02-18 09:42 · Score: 0

You forgot Apple, you dumbass. That's what this article is about.
Re:Witness... by GlassHeart · 2004-02-18 10:37 · Score: 3, Insightful

"The reason why OSX 'just works' on Apple computers is because Apple has complete control over the hardware." [...] is something Apple people say and it makes them feel good, because implied in it is the presumption that Apple's hardware is actually better than what the unwashed masses buy at Fry's.
No, it's something you say to point out that Apple has a much smaller of hardware combinations to support.
to revolutionize the industry, it isn't necessary to support all hardware. You could support only ECS K7VTA3 boards, with an ATI video card. And that tiny slice of the PC world would still DOUBLE YOUR MARKET SHARE.
It would also put Apple directly in the crosshairs of Microsoft. There's no way Microsoft would overlook this challenge. It's not a matter of losing a few percent over years, but a real danger of mass exodus. Remember also that this is a Microsoft that just basically got off with a slap on the wrist with its anti-trust case. Can you imagine another Attorney General taking them on again soon?
your protestations that a huge amount of work would have to be done to port everything over to x86 simply betray that you haven't written code to compile cleanly on multiple systems.
Compile cleanly? You're not seriously suggesting that something that compiles cleanly is good enough to ship? Different hardware platforms and compilers will make bugs show up. You'll also need to increase QA capacity dramatically.
It's not very hard to port code to a different platform and get it to an alpha level. To get it ready to ship is another story entirely.
Also, while Adobe might port Photoshop to x86 OS X, do you imagine Microsoft would port Office to it?
All the applications that Apple depends on were originally written for the real computer market -- MS Office, Adobe, etc, and ported only as a way of squeezing a few more sales out of them.
Excel was originally developed on the Mac in 1985. Word was also developed on the Mac before there was a Windows version (a DOS version that doesn't really act like either predates the Mac version). The original version of Photoshop was written on a Mac Plus. So what are you talking about?
Why are Jobs & Followers limiting their potential market in this way ? The only answer is that they are afraid of being precisely the type of computer revolutionaries that they pretend to be in Super Bowl Ads.
I have a much simpler explanation: they are afraid of Microsoft. Why do you find that hard to believe?
Re:Witness... by Gherald · 2004-02-18 11:35 · Score: 1

Ah yes, you've said everything I was thinking but just didn't have the time/inclination to articulate.

+5 Insightful should go to you, my post was just venting.

--
The unofficial /. digest
Re:Witness... by Selecter · 2004-02-18 11:40 · Score: 1

It's a ram hog becuase it's designed to be. Ram is thousands of times faster to access than your HD - the whole OS caches *everything* it can get it hands on. The real minimum to run OS X with aplomb is 1.5 GB. Above that you run into the diminishing return factor, unless you are doing really serious video work.
Re:Witness... by Anonymous Coward · 2004-02-18 11:54 · Score: 0

This is the biggest croc of pure, unadulterated horseshit I have ever read. It's also flamebait. To wit:

Mac OS X for x86 would suck. Unless they put a lot of money into driver support or emulation of Win32 drivers, which is risky and inelegant.

Pure bollocks. NeXTSTEP for x86 existed when Windows 3.1 existed - and looked and ran better.

Windows XP would look elegant by comparison

Flamebait.

OSX has a fairly large number of commercial software [sic] availeable [sic] that could give it an edge over Linux as an alternative x86 desktop", the answer is NO

This isn't even relevant. OPENSTEP had issues with NT as an underlying platform, but recompiling, ceteris paribus, is not going to hurt anything.

You OSX-for-x86 folks are so naive, it ceased to be funny a long time ago.

Flamebait; the pot calling the kettle black.
Re:Witness... by Gherald · 2004-02-18 13:19 · Score: 1

Pure bollocks. NeXTSTEP for x86 existed when Windows 3.1 existed - and looked and ran better.

That may have been true then, but it is hardly relevant now. I was comparing OS X to WinXP.

>>Windows XP would look elegant by comparison
>Flamebait.

That is only a partial quote of what I said, but call it whatever you like, its my opinion and I think its pretty solid conclusion based on the facts I was alluding to.

Now wrt recompiling commercial software, I think this guy explains it best. (mods: mod him insightful)

>>You OSX-for-x86 folks are so naive, it ceased to be funny a long time ago.
>Flamebait

Yeah, so? It may be inflamatory, but I'd welcome a response that shows why it ain't so. You, sir, seem informed and educated enough, but you're making the assumption that past *STEP experiences on an x86 platform are 100% relevant to OSX-on-x86.

I'm afraid that's not the case.

--
The unofficial /. digest
Re:Witness... by Quobobo · 2004-02-18 13:49 · Score: 1

I think that a large chunk of this is that they both have to incorporate a lot of functionality that's already built-in to the Mac OS. Quicktime is the system's default media viewer on OS X, and just about every other native application on OS X incorporates it in some way. In comparison, you have to stack it on top of everything else that's already there in Windows.

In addition to this, iTunes relies heavily on Quicktime and a few other things (Rendezvous, iPod support) that are pretty firmly embedded in OS X. I don't think there's a perfect solution that doesn't involve absolutely massive rewrites of the software.
Re:Witness... by mbbac · 2004-02-19 01:59 · Score: 1

You named one.

It was obvious that we were discussing desktop operating systems. Your last two are not in that segment; they were both embedded systems.

Try again.

--
mbbac
Re:Witness... by Anonymous Coward · 2004-02-19 07:45 · Score: 0

Okay...

Apple
IBM
Microsoft

Isn't that three? Is three more or less than two?
Re:Witness... by mbbac · 2004-02-19 11:11 · Score: 1

No, that's one.

Apple and IBM sell systems. Microsoft sells an operating system. Actually, IBM proves my point. They sold OS/2 and failed.

--
mbbac
Re:Witness... by Anonymous Coward · 2004-02-20 06:30 · Score: 0

I guess in your universe Red Hat isn't successful, either.

Or, were you unaware that they're profitable, and sell operating systems?

Of course, by your own logic, Microsoft doesn't make operating systems either. I mean, they just sell software, and an operating system just *happens* to be there. Since you disqualify Apple, since they also sell computers, I guess Microsoft should be disqualified for uh... releasing the Xbox.

Seriously, you don't make any sense.

Novell still sells operating systems at a profit. Of course, I guess you disqualify them for... oh, hell, who knows what you'll come up with. I guess they're not successful because they only make hundreds of millions of dollars, rather than billions upon billions.

What about Sun? They sell Solaris successfully, but uh... that doesn't count because...

Oh I don't know. Because you said so, I guess.
Re:Witness... by mbbac · 2004-02-20 07:15 · Score: 1

Everyone knows Red Hat makes their money on service, not the OS. And are you not up on the fact that Red Hat no longer sells a desktop version of Linux? They promote Fedora now. More proof of my position. They begrudingly made an enterprise desktop version available -- but they still make their profits off of service.

The Xbox is a game console, not a PC. Everyone knows that. Quit pulling red herrings out of your pocket.

Novell doesn't have a desktop product.

Sun sells systems, not operating systems. You'd think you would recognize that and quit bringing up such companies.

You also forget that Mac OS X has already been sold by itself on the free market just like OS/2 and BeOS and it too failed. I think you'll recall it was called Nextstep back then.

--
mbbac
Re:Witness... by Anonymous Coward · 2004-02-20 10:54 · Score: 0

Sun sells systems, not operating systems.

Seriously, this is just a little over the top. They sell their OS, in a box, and it runs on ANY x86 PC. So does Red Hat. I'm tired of *your* red herrings.

I guess you win your very own game of, "When I make up all the rules, I'm always right." See, I don't know about you, but when I give a company (Red Hat/Solaris/Apple/Novell/IBM/Microsoft) money (dollars) for an operating system, I foolishly considered that, "Them selling an OS." Clearly, every English speaker is wrong, and you're the champ.

I guess you get a very nice prize for that. Enjoy!
Re:Witness... by mbbac · 2004-02-23 02:38 · Score: 1

You were supposed to be listing companies that succeeded selling OSes. Not companies that merely sell OSes.

--
mbbac
Re:Witness... by Anonymous Coward · 2004-02-23 06:04 · Score: 0

Do you have a problem with your definition of the word 'success'? They sell the OS, at a profit. They make money at it. Sounds successful to me.

Maybe you only define success as, "Becoming the richest man in America." Well then gee, I guess you're right. Or possibly, in order to be successful, you must be Microsoft. Of course, the bad news for you is that selling an item at a profit is considered successful in business by say, the vast majority of the english-speaking population.

But like I said, you must be some kind of special needs case, so it's not really worth it.

these numbers seem to high by rollthelosindice · 2004-02-18 07:11 · Score: 1, Interesting

to go from 1 billion in debt to 4.8 in cash is a large move even for 6 or 7 years of good business. I'd wait to see this in an SEC filing before i believe it.

Re:these numbers seem to high by Kenja · 2004-02-18 07:17 · Score: 1

They've had the cash for some time now. They just never got around to paying off their debts.

--

"Have you ever thought about just turning off the TV, sitting down with your kids, and hitting them?"
Re:these numbers seem to high by Smidge204 · 2004-02-18 07:20 · Score: 1

Debt is what you owe other people. It has nothing to do with how much you actually have.
=Smidge=

Time to celebrate... by Anonymous Coward · 2004-02-18 07:11 · Score: 0, Funny

...by putting a whole bunch of iPods on the credit card.

Where did the money come from by SuDZ · 2004-02-18 07:11 · Score: 4, Interesting

Now that they are out of debt I wonder what the percentages of the income were. For example was the new OS's able to give 20% of that, the iPod good for 40% etc. What about iTunes? I know I just picked those %'s out of the air and have no way of guessing what they might be but what do you guys think helped them get into the clear?

SuDZ

why wait so long? by MrDigital · 2004-02-18 07:11 · Score: 2, Insightful

I don't understand why a company with $4.8 billion (or $5.1 billion pre-$300mill hit) would wait this long to pay off the $300 million owed. Obviously the money is coming in hand over fist, so they would probably want to pay it off as soon as possible to please investors. Not much is more enticing than a company with billions of dollars in the bank and no debt as it means the company is being run in a 'correct' way.

--
In a digital world there can be only one..
The one, the only, MrDigital.

Re:why wait so long? by katre · 2004-02-18 07:15 · Score: 4, Informative

I don't understand why a company with $4.8 billion (or $5.1 billion pre-$300mill hit) would wait this long to pay off the $300 million owed.

When they say $4.8 billion in the bank, they don't mean $4.8 billion sitting there doing nothing. They mean $4.8 billion, part of which is earmarked for salaries in the next quarter, part of which is for office space, maintainance, etc, part of which is for production of new units, part of which is for research and development, and maybe a very tiny bit that's actually not earmarked for anything. And it's that tiny bit not earmarked for anything that they can use to pay off the debts. Remember: $4.8 billion is a lot of cash, but Apple is a huge company these days, and it takes a lot of cash to keep that going.
Re:why wait so long? by CrazyTalk · 2004-02-18 07:19 · Score: 3, Informative

According to the article , the debt just matured - I'm only guessing, but if they paid it off early there may have been large monetary penalties.
Re:why wait so long? by tonydiesel · 2004-02-18 07:23 · Score: 1

Very simple. Depending on the interest rate of their debt -- they were probably making more in interest by sitting on their cash, than the interest that was accruing on their debt. Thus it made more sense for them to sit on the cash as long as possible because it was worth more to them in interest than it was as a payment on the debt.
Re:why wait so long? by Anonymous Coward · 2004-02-18 07:25 · Score: 0

it means the company is being run in a 'correct' way.

Having debt doesn't mean that a company is not being run the 'correct' way. There is nothing inherently wrong with debt as long as you have the cash flow to service it. It allows you to do bigger and greater things than your bank account may allow. Kind of like getting a mortagage to buy a house. You are using debt to get an appreciable asset at today's price and when it's paid off in 30 years, it will be worth a lot more. In the mean time, you have been getting 30 years worth of use out of it.
Re:why wait so long? by Don+Negro · 2004-02-18 07:29 · Score: 5, Informative

I don't understand why a company with $4.8 billion (or $5.1 billion pre-$300mill hit) would wait this long to pay off the $300 million owed.

If the $300M was comprised of corporate bonds, (and the phrase 'which we decided to hold to maturity' indicates that it was) then paying them off earlier would have meant giving the bond holders back their capital. Since those bond holders would have had to reinvest at last year's lower interest rates, Apple would have been doing them a dis-service. By holding them to maturity they make those bond holders more likely to purchase Apple corporate debt in the future, which could lower their total borrowing costs down the line

--
Don Negro
Perl 6 will give you the big knob. -- Larry Wall
Re:why wait so long? by Dukael_Mikakis · 2004-02-18 07:38 · Score: 4, Interesting

Pleasing investors has nothing to do with being debt-free. If you have a friend that will loan you money at 1% interest, and you can turn and loan that money to somebody else at 2% interest, you'd want as much debt as possible, and your investors (in this case, you) would be thrilled that you have so much debt.

In fact, in successful companies, investors might actually prefer debt. If you and a friend have a project that will cost $1200 but will net you $1800 in a year, you each stand to gain $900 minus your investment. But you only have $800 total. If you get another friend in on it, all three of you will only net $200 apiece ($600 - $400). If you get $400 debt at 5%, then the two of you will make $1800 - $420 (debt + interest) = $1380 / 2 = $690 - $400 = $290.

So the current investors end up making more by taking debt. Of course new investors would love an opportunity at profiting from this project, but companies tend to look out for current shareholders more than anything else.
Re:why wait so long? by Anonymous Coward · 2004-02-18 07:51 · Score: 0

Well, the reason they "waited" so long is because the bonds that were issued did not MATURE until 2/15/04 with only a Make Whole call provision (very restrictive). Hence, they couldn't refund the issue even if they had $300 billion in the bank to do so. (note, there are other ways around this, but at 6.5% coupons, it would have been prohibitively expensive to offer a tender on the securities).

You guys are great coders (no doubt), but leave the incredulous statements on finance to the experts. Thanks! :-)
Re:why wait so long? by techsoldaten · 2004-02-18 08:06 · Score: 1

> > If you and a friend have a project that will
> > cost $1200 but will net you $1800 in a year, you
> > each stand to gain $900 minus your investment.
> > But you only have $800 total. If you get another
> > friend in on it, all three of you will only net
> > $200 apiece ($600 - $400). If you get $400 debt
> > at 5%, then the two of you will make $1800 -
> > $420 (debt + interest) = $1380 / 2 = $690 - $400
> > = $290.

Perhaps it is just the way you described it, this whole scheme of yours sounds very much like an Enron accountant's wet dream.

M
Re:why wait so long? by Dukael_Mikakis · 2004-02-18 08:09 · Score: 2, Interesting

Since those bond holders would have had to reinvest at last year's lower interest rates, Apple would have been doing them a dis-service.

Not really. Unless there are specific covenants on the bond (typically not), Apple wouldn't have given them the capital back, but sold the debt for its market value (on the Bond market) or whatever.

If the bond-holders were sitting on bonds that were paying a higher rate than the market rate, then Apple would have had to give them more than just the principal to pay off the debt.

Bond prices fluctuate with the interest rates as well, so paying off early would have netted bond-holders a premium and the opportunity to reinvest. If things were as you say they were, Apple could quite easily commit arbitrage by getting $1000 of cheap debt and paying off $1000 of expensive debt. But what would have happened is they could have bought $1000 of cheap debt but would have had to pay, say, $1100 to clear their $1000 of expensive debt (for the projected interest).
Re:why wait so long? by larry+bagina · 2004-02-18 08:48 · Score: 2, Informative

According to the SEC filings, the debt was callable -- ie, they could buy it back at any time without penalty.

--
Do you even lift?
These aren't the 'roids you're looking for.
Re:why wait so long? by Hiro+Antagonist · 2004-02-18 09:41 · Score: 1

Yes-and-no; it depends on how likely I am to collect the full amount back from the money I've dished out. In an ideal (or at least sane) world, everyone would pay me back, and I'd make money; but in the real world, people default, and if enough people default, I lose money.

--

--
I Hit the Karma Cap, and All I Got Was This Lousy .sig.
Re:why wait so long? by Anonymous Coward · 2004-02-18 12:35 · Score: 0

"If the $300M was comprised of corporate bonds, (and the phrase 'which we decided to hold to maturity' indicates that it was) then paying them off earlier would have meant giving the bond holders back their capital. "

This is the real reason why Apple didn't do it earlier. Paying a the bond holders off today is a lot more expensive than paying them later - eg a $1000 today is more valuable than $1000 next year since you could invest that money today. Apple would be paying a higher implicit interest rate if they paid off the bond holders early.

Pre-emptive Mac bashing reply by veddermatic · 2004-02-18 07:11 · Score: 0, Troll

"LOL Macs Suck!!@!!!"

"Yeah, they may be in good financial shape, but they can't play games!"

"LOL, if they'd come out with loganberry colored ones they'd make even more money! LOL!!!@!!!"

--
Department of Homeland Security: Removing the rights real patriots fought and died for since 2001

debunk by fjordboy · 2004-02-18 07:11 · Score: 5, Funny

I can debunk it right now - Steve Jobs owes me thousands of dollars for the mental anguish I've experienced when trying to use the imac's original "hockey puck" mouse.

--
The anti-salmon

Re:debunk by Anonymous Coward · 2004-02-18 07:15 · Score: 0

dork, why didn't you just buy another mouse? Don't you have to try to mitigate the damages yourself before you launch a massive assault? Y'know, kinda like SCO should have done from the start?
Re:debunk by GoofyBoy · 2004-02-18 07:25 · Score: 4, Funny

Do you know how much they've saved with not having to produce or do R&D for a second mouse button?

--
The surprise isn't how often we make bad choices; the surprise is how seldom they defeat us.
Re:debunk by Anonymous Coward · 2004-02-18 07:27 · Score: 0

Y'know, kinda like SCO should have done from the start?
Buy another mouse?
Re:debunk by SuperBanana · 2004-02-18 07:29 · Score: 5, Insightful

Steve Jobs owes me thousands of dollars for the mental anguish I've experienced when trying to use the imac's original "hockey puck" mouse
Yeah, and your mother owes you millions for dropping you as a child, since those of us who weren't dropped, went to the store and bought a $40 optical scroll-wheel mouse ;-)
(Sorry, pet peeve for those who complain about the fact that a computer, designed+marketed to be EASY TO USE, comes out of the box with only one mouse button but is perfectly capable of using a fancier one if your heart desires).

--
Please help metamoderate.
Re:debunk by Anonymous Coward · 2004-02-18 08:05 · Score: 0

Here is an idea, why don't they make a better mouse? You wouldn't have to buy another one, you get more then one button, and they could even add a mouse wheel!

Oh wait, this is Apple. Even with their prices they are too cheap to give you a decent mouse, or a computer for that matter.
Re:debunk by Anonymous Coward · 2004-02-18 08:07 · Score: 0

but your forgetting the fact that macintosh users are incapable of buying parts for their computer - or else they would be PC users.

oh and lord jobs says your mouse should be round, then your mouse should be round damnit!
Re:debunk by Anonymous Coward · 2004-02-18 08:08 · Score: 0

Five dollars? No... ten?
Re:debunk by norculf · 2004-02-18 08:12 · Score: 1

Mental anguish? What about the carpal tunnel injuries?
Re:debunk by yardbird · 2004-02-18 08:27 · Score: 2, Insightful

He wasn't complaining about the one-buttonness. He was complaining about the "I'm a perfect circle so you can't tell which way is up"-ness. However, your point about buying a replacement mouse is, of course, still valid.

--
Free, legal music for iTunes users.
Re:debunk by Awptimus+Prime · 2004-02-18 08:38 · Score: 2, Informative

I think he was kidding around about it.

In all reality, there is little reason for PCs to ship with multi-button mice. I did technical support for 3 years and you would not believe the odd silence, tantarums, and general ignorance exposed when asking someone (who's had their computer for two years) to 'right click' on an icon. I would say a solid third of the people I dealt with had never used that mouse button and confused by it.

I use a Apple keyboard on my PC, so I can't blame a Apple user using a PC mouse. Thank god for USB, eh? ;-)
Re:debunk by Blic · 2004-02-18 08:42 · Score: 1

And someone, somewhere, owes you a sense of humor. =)
Re:debunk by prockcore · 2004-02-18 08:47 · Score: 4, Insightful

(Sorry, pet peeve for those who complain about the fact that a computer, designed+marketed to be EASY TO USE, comes out of the box with only one mouse button but is perfectly capable of using a fancier one if your heart desires).

The hockey puck wasn't hated because it only had one mouse button. It was hated because it wasn't easy to use. It will go down in history as the worst designed mouse ever.
Re:debunk by Speare · 2004-02-18 08:53 · Score: 1

The ONLY reason I haven't bought a tiBook is the one-button touchpad. Sure, I *could* plug a mouse into the back of the laptop, just like I *could* plug a CRT into it. The equipment doesn't meet my bar, thanks to their insistence on the one-desktop, one-button, one-world ideology.

--
[ .sig file not found ]
Re:debunk by PeterHammer · 2004-02-18 09:08 · Score: 1

Unfortunately though, the same cannot be said about the Powerbooks or the iBooks. How much would it take to offer a damn power user version with a three button trackpad? I understand your position when it comes to desktop users, but if you bought a powerbook, you are severely hindered by what I would call "a design flaw on an otherwise perfect machine".

Sure you can attach a mouse, but that severely limits where you can use your "LAP"top doesn't it?
Re:debunk by MoneyT · 2004-02-18 09:15 · Score: 2, Interesting

That's when you go get the mouse drivers that turn teh physical button into a right click, and the pad itself into a left click. Problem solved.

Did I mention teh driver also adds scroll zones to the sides of the trackpad?

--
T Money
World Domination with a plastic spoon since 1984
Re:debunk by Anonymous Coward · 2004-02-18 09:36 · Score: 0

See? He IS a dork.
Re:debunk by Anonymous Coward · 2004-02-18 09:42 · Score: 0

Hmmm.. is there a public vote for this, or is it some sort of Dark Cabal that decides these things?
Re:debunk by dasmegabyte · 2004-02-18 09:54 · Score: 1

Hmm. Maybe you should take this up with my hardware guy, who spent $500 putting a new chip into his old G3. It certainly seemed to go faster, but perhaps it was an illusion caused by swamp gas passing in front of the monitor.

BTW: just because you are able to sink $1000 in your computer every year doesn't mean you are better than those of us who buy a new $2000 mac every two years.

--
Hey freaks: now you're ju
Re:debunk by Anonymous Coward · 2004-02-18 10:25 · Score: 0

How about they just give me my second goddamn button instead?
Re:debunk by Andy_R · 2004-02-18 11:21 · Score: 3, Funny

1) If your hand is able to reach the touchpad, it is less than 1 inch away from the keyboard where there about 100 buttons. Are you really too lazy to reach them?

2) You should take a look at the folllowing list of Mac software that requires a 2nd button:

If you don't intend using any of those, you should be ok.

--
A pizza of radius z and thickness a has a volume of pi z z a
Re:debunk by MoneyT · 2004-02-18 12:47 · Score: 1

Because the OS is fully functional with one button and because on a laptop, if you're using the trackpad, your hand is near the keyboard, so you can use the damn modifier keys.

--
T Money
World Domination with a plastic spoon since 1984
Re:debunk by WiggyWack · 2004-02-18 14:18 · Score: 1

Actually, Maya requires three mouse buttons.

--
Macintosh humor! MacComedy.com
Re:debunk by Phil+Wilkins · 2004-02-18 16:40 · Score: 1

If you're using Maya on a powerbook, you have bigger problems than the lack of mouse buttons.
Re:debunk by catch23 · 2004-02-18 16:50 · Score: 1

Oh great. so maybe they should just invent a mouse with zero buttons. Then blame it on lazy users to just use the keyboard for clicking. That would really save on the R&D costs!!
Re:debunk by Tore+S+B · 2004-02-18 20:45 · Score: 1

The hockey puck wasn't hated because it only had one mouse button. It was hated because it wasn't easy to use. It will go down in history as the worst designed mouse ever.

You are talking to a retrogeek. And you are wrong. The DECStation puck was even worse. Imagine a puck, with two buttons, and a really really bad sensor.

-tsb

--
toresbe

About Time by dbesade · 2004-02-18 07:11 · Score: 2, Insightful

Since 1997, eliminating that much debt in 7 years is a real accomplishment. At least we now know, finally that Apple isn't going out of business or declare bankruptcy. (Like it was going to happen anyway)

Bad? by Ymiris · 2004-02-18 07:12 · Score: 2, Informative

Isn't this a bad thing? I thought if you were out a debt you were in danger of being bought..or am I completly off here?

--
**It runs through my veins like radioactive rubber pants! Do not deny my veins!**

Re:Bad? by DR+SoB · 2004-02-18 07:17 · Score: 1

A wise man once said "You can measure a man's wealth by how much he owe's.".

When Apple started they had very little debt as well, apparently this didn't help much back then. It's really all about marketing, not how much you have saved under the mattress...

--
Mod +5 Drunk
Re:Bad? by yroJJory · 2004-02-18 07:23 · Score: 2, Informative

Also, keep in mind the concept of a poison pill.

If you as a business consultant, they'll tell you the best thing you can do for a home business is pay off your house, but exercise a line of equity. You don't have to actually USE the equity line, and no one can tell how much you HAVE used.

So, someone who slips and falls on your property and considers suing you simply to take your house will think twice, as you may have borrowed a huge amount on it and it would cost them more to repay it.

I'm sure corporations exercise similar concepts. Being out-of-debt is always a good thing. Ensuring that you don't look like a good target requires creative ways of _appearing_ in debt.

--
Jory
Re:Bad? by xs650 · 2004-02-18 07:24 · Score: 1

That was my thought too. I can see SCO making an offer anytime now.
Re:Bad? by dbesade · 2004-02-18 07:25 · Score: 1

Indeed you are slightly mistaken here. Since Apple is now a debt free company, it makes it a more attractive buy for someone else since they do not have to take more debt, it makes it more attractive.
Re:Bad? by yroJJory · 2004-02-18 07:26 · Score: 4, Funny

Indeed you are slightly mistaken here. Since Apple is now a debt free company, it makes it a more attractive buy for someone else since they do not have to take more debt, it makes it more attractive.

Oh. I see. Instead, we'll have to endure the "Apple is going to be bought by Disney" rumors again. Lucky us.

--
Jory
Re:Bad? by Anonymous Coward · 2004-02-18 20:52 · Score: 0

No... It's going to be "Disney is going to be bought by Apple" rumors now.

Lesson Learned... by fetus · 2004-02-18 07:12 · Score: 5, Funny

Sometimes overcharging does pay off...

Re:Lesson Learned... by jasonhamilton · 2004-02-18 07:15 · Score: 2, Funny

They only had to sell 2 dozen ipods :)

--
SearchIRC - Now with live chat directory!
Re:Lesson Learned... by homeobocks · 2004-02-18 07:16 · Score: 0

You've got me wondering now if I can order a G5, and get a refund for OS X, running linux instead.

--
MOUNT TAPE U1439 ON B3, NO RING

its about time by steak · 2004-02-18 07:12 · Score: 2, Funny

I gave jobs three blintz to paint my fence back in '01, maybe now he can get around to doing it.

--
lose != loose

Re:its about time by Anonymous Coward · 2004-02-18 07:21 · Score: 0

Those blintzes were terrible.
Re:its about time by Anonymous Coward · 2004-02-18 07:22 · Score: 0

those blintzes were crap!
Re:its about time by Anonymous Coward · 2004-02-18 07:26 · Score: 0

Paint my fence!
Re:its about time by Anonymous Coward · 2004-02-18 07:29 · Score: 0

Make me!
Re:its about time by Anonymous Coward · 2004-02-18 07:34 · Score: 0

You give me back those blintzes!
Re:its about time by Anonymous Coward · 2004-02-18 07:42 · Score: 0

Order, order. We don't care about your blintzes.

memo text from website by jshift2work · 2004-02-18 07:13 · Score: 1, Redundant

Team, Today is a historic day of sorts for our company. When I arrived back at Apple in mid-1997, the company was burdened with $1 billion of debt. Through everyone's hard work we turned Apple around, paid off the majority of our debt and began to amass a war chest of cash in the bank which has grown to about $4.8 billion! But there was still $300 million of remaining debt, which we decided to hold to maturity. Today we used $300 million of our cash to pay off this remaining debt. Apple is now a debt-free company - for the first time in over a decade! It sure feels good. Steve

Re:memo text from website by Anonymous Coward · 2004-02-18 07:52 · Score: 0

My opinion of Jobs just went up a few notches because he said "a historic" instead of "an historic." Woohoo!

Yay... by Anonymous Coward · 2004-02-18 07:13 · Score: 2, Funny

Now they can afford to cut the price of the ipod mini damn it...

Re:Yay... by macMaestro · 2004-02-18 07:30 · Score: 1

With 100,000 preorders - I don't think they need to.

All this means... by Anonymous Coward · 2004-02-18 07:13 · Score: 0, Flamebait

...is that Apple will now increase spending on its secret relationship with Fisher-Price's R&D to come out with uglier and gaudier looking products.

Re:All this means... by MuckSavage · 2004-02-18 07:32 · Score: 1

I think you're confusing apple with Windows XP.
Re:All this means... by kannibal_klown · 2004-02-18 07:55 · Score: 3, Insightful

You'r thinking of Dell. I have literally always said that my 2 Dell laptops felt like they were manufactured by Fisher-Price. They were made of cheap, flimy pastic; worse than cheaper brands of notebooks.

Allps products are usually built like tanks. The iBooks (though cheap in price) are sturdy little buggers, and the powerbooks are elegant and sturdy.

While they may LOOK odd, at least their made of sturer stuff.

Good for everyone by AvantLegion · 2004-02-18 07:13 · Score: 5, Insightful

A healthy Apple is important for the computer industry. Even if you don't use Apples, you benefit from the PC industry's price undercutting of Apple's products. Apple is only "expensive" in the sense that everyone else endeavors to be cheaper.

Choice is good - including platform choice.

Re:Good for everyone by Anonymous Coward · 2004-02-18 07:17 · Score: 0

Had to comment on your tagline:

LOSE is the opposite of WIN
LOOSE is the opposite of TIGHT
It's really not that hard, people...

Yeah, but Lose Dough's the same as Windows.
Re:Good for everyone by Anonymous Coward · 2004-02-18 07:22 · Score: 2, Funny

I don't see that as necessarily true. Even if we were to loose Apple, for all intensive purposes their'd be alot of competition, Dell vs HP for example. Apple has rediculous prices because of it's exclusive machines whereas Dell and HP are selling commodities. About the only thing Apple help's is keeping the MPAA of our backs with it's iTunes thing.
Sorry, I just wanted to annoy you.
Re:Good for everyone by Nom+du+Keyboard · 2004-02-18 07:26 · Score: 1, Offtopic

LOSE is the opposite of WIN
LOOSE is the opposite of TIGHT
It's really not that hard, people...
Tell it to my spell checker.

--
"It's the height of ridiculousness to say for those 9 lines you get hundreds of millions."
Re:Good for everyone by Anonymous Coward · 2004-02-18 07:46 · Score: 0

"Apple is only "expensive" in the sense that everyone else endeavors to be cheaper."
That is, by far, the most ignorant thing I have ever seen anyone claim on Slashdot. Wow, the sheer ignorance of that statement really puts me in awe.
Re:Good for everyone by Anonymous Coward · 2004-02-18 07:48 · Score: 0

Funny-but-true story: Dow Jones news service declared earlier this week that it would no longer allow writers and editors to use spell-check. The deal is that writers' spell-checkers turned proper names into common words too often. So now, spell-checking has been banned at Dow Jones.
Re:Good for everyone by caino59 · 2004-02-18 07:55 · Score: 1

"A healthy Apple is important for the computer industry"

I thought apples were important to personal health... :oP
Re:Good for everyone by reso · 2004-02-18 07:57 · Score: 2, Funny

for all intents and purposes HP and Dell run the same OS

...now for intensive purposes i likes me sum vasoleeeeeen

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Re:Good for everyone by Anonymous Coward · 2004-02-18 08:09 · Score: 0

i hope you dont loose your mind over the fact that your argument is lose.
Re:Good for everyone by Orien · 2004-02-18 08:36 · Score: 1

That's way off base. You must not have paid any attention at all to the XServe and how it has affected the market. When I heard the keynote anouncing the XServe the first thing I did was go around to all the big web sites, dell, hp, sun, etc. and price 1U servers. I could not find a single one that had anywhere CLOSE to what the XServe was offering for the same price. Most 1U servers with any kind of horse power started around $5000 and went up from there. How ever the XServe has totally changed that in just a few months. Just last week we ordered an new HP 1U server with dual 2ghz Xeons for under $2000. I blame Apple for that. Everyone has been slasing thier prices so that people don't flock to Apple. The more competition the better.

--
SCO.com uses Linux
Re:Good for everyone by Anonymous Coward · 2004-02-18 08:45 · Score: 0

I seriously doubt my local white box PC manufacturer from whom I bought an AMD Opteron box for under $1000 is thinking "must make systems cheaper than Apple" when they sell me one. Far more likely they are thinking "must make systems cheaper than Dell" or "must make systems cheaper than next door white box seller". Hate to break it to you, but for the vast majority of computer users in the world, Apple isn't on the radar.
Re:Good for everyone by AvantLegion · 2004-02-18 09:07 · Score: 1

You mean like every PC manufacturer releasing their iPod ripoffs, with the only real selling point being "cheaper than iPod"?
You're right, nobody pays attention to Apple.
If Apple releases a PowerBook or PowerMac cheaper than comparative PC high end machines, the PC systems will become cheaper overnight.
Re:Good for everyone by Anonymous Coward · 2004-02-18 10:06 · Score: 0

If Apple releases a PowerBook or PowerMac cheaper than comparative PC high end machines, the PC systems will become cheaper overnight.

My god, Apple users are amazingly delusional. Here's a hint for you, dipshit, whether or not Apple comes out with a new laptop that it cheaper than the competition, PC based laptops will ALWAYS get cheaper "overnight". In case you haven't noticed, the price of computers always goes down, not up. I find it sadly hilarious that Mac users are convinced that the entire computer using world is simultaneously envious of Apple and "out to get them". Wake the fuck up, man, Apple is a niche platform with at most 1 or 2 percent market share. You might as well sit there proclaiming how every time Yugo comes out with a new model of car, Honda and General Motors immediately do the same to undercut them.
Re:Good for everyone by Jeff+DeMaagd · 2004-02-18 10:26 · Score: 3, Interesting

I agree, I think we do need Apple, or at least we did.

They kickstarted the horribly lagging USB device market. A lot of windows GUI elements seem to come from Apple. Zen seems to be heavily iPod inspired, for all I know, maybe we'd be stuck with ugly Nomads and Nomad clones.

Before Jobs took over, the PC market looked like a bunch of ugly square beige boxes, since, we now get a bunch of ugly multi-colored varying swoop-shaped windowed boxes. I haven't checked to see if there are any G5 inspired PC cases yet.
Re:Good for everyone by Anonymous Coward · 2004-02-18 11:27 · Score: 0

A healthy Apple is important for the computer industry.

Well it's certainly better than a rotten Apple. I hear just one of those can spoil the whole barrel.

Market share isn't everything! by SoTuA · 2004-02-18 07:13 · Score: 5, Insightful

If found true, this tidbit of information goes to show that market share isn't everything... unless you do business in commodity goods. Apple computers have been always marketed at a niche of people who are aware of the fact that quality & luxury costs a little more. You can be a successful company with only 5% of the market.

Who needs the market share when you've got a cool 4 billion bucks in the bank, and the mind share - apple equals style and coolness, like it or not.

Now back to my beige box... :(

Re:Market share isn't everything! by Zangief · 2004-02-18 08:14 · Score: 1

Javier, since you got macs for your whole family, YOU need the market share now. As their market share decreases, their price would go UP, and you can end with expensive computers to maintain, with no applications to run, and which cannot comunicate easily with others computers.
Re:Market share isn't everything! by Beryllium+Sphere(tm) · 2004-02-18 09:53 · Score: 1

Except that market share leads to lower prices. Apple's still in business because they're buying standardized parts like IBM hard disks and standard interfaces like USB and Firewire, parts that have enough market share to participate in exponential price drops.

If they'd stuck with proprietary hardware they'd have gone into a death spiral like all the old workstation companies who got eaten by PCs.

Market share also matters for software availability. If Apple's market share were much lower, more software developers would abandon the platform. A computer is a software player -- no software, no usefulness.
Re:Market share isn't everything! by dasmegabyte · 2004-02-18 10:06 · Score: 3, Informative

FUD CHECK:

market share decreases, their price would go UP
Check 1. Apple's market share HAS decreased since the mid 1990s, and yet their price points, even when not adjusted for inflation, have gone down. The cheapest apple laptops used to be in the $2500 range. Now they're at $1100.

expensive computers to maintain
Check 2. Not in my experience. I have spent less money maintaing the apple computers in my house than the PCS. In fact, going back to my still running Mac Classic, the only problems I've ever had have been with power supplies and hard drives. The power supplies were always replaced for under $100.

with no applications to run
Check 3. The mac currently has an analog for every major PC application. It runs nearly every open source application. And even if Apple dissipated, there would still be development. There is still development for the Amiga.

cannot comunicate easily with others computers
Check 4. My macs communicate fine with Linux, fine with Windows. Office suites use the same formats. Internet apps work the same. They all use Samba file and printer sharing. But maybe you use mostly IBM mainframes. I hope so, because the mac works with them too.

It's good to see FUD is alive and well in the PC community. I'd hate to think you guys learned nothing from Microsoft.

--
Hey freaks: now you're ju
Re:Market share isn't everything! by dasmegabyte · 2004-02-18 10:12 · Score: 1

standard interfaces like USB and Firewire

Uh, Apple invented Firewire. If it's a standard interface now, it's BECAUSE of Apple using it as the defacto connector. The PC world still thought USB 1.1 was fast.

Apple's motherboards are still quite proprietary, as are their monitor connectors and many other parts of the machine. Even their chips, while based on IBM designs, contain proprietary instructions.

--
Hey freaks: now you're ju
Re:Market share isn't everything! by SoTuA · 2004-02-18 10:47 · Score: 1

aha, but I already fled the house :D
I saddled them with macs just before I left because I wouldn't be there to do tech support. I just can't imagine the mayhem that would happen if I had left them with Windows PCs :D
Re:Market share isn't everything! by Anonymous Coward · 2004-02-18 11:19 · Score: 0

Gotta love people like that. They just make crap up.

PCs were invented in Nazi germany to subject millions of jews to death.

Macs were invented by aliens.

See? Think people. Look stuff up. Anybody can just make up something.

The big question by JessLeah · 2004-02-18 07:13 · Score: 0, Interesting

Will Apple use a bit of additional money to pay back the money Microsoft invested in them back... oh, was it 5, 6, 7 years ago? That might revive the old OS wars, and make a lot of Mac fans (including myself) quite happy...

--
Honey, I shrunk the Cygwin

Re:The big question by Planesdragon · 2004-02-18 07:23 · Score: 1

Will Apple use a bit of additional money to pay back the money Microsoft invested in them back... oh, was it 5, 6, 7 years ago?

MS cashed out awhile ago. And, from what I've heard, they only bought the money because Apple forced them into a deal / settlement that gave them cash and Office for five years.
Re:The big question by Anonymous Coward · 2004-02-18 07:23 · Score: 1, Funny

For someone who claims to be an Apple fan, you sure know sweet fuck all about the Microsoft "investment."
Re:The big question by pyros · 2004-02-18 07:31 · Score: 1

Microsoft bought $150 million in stocks, and has already sold them I believe.
Re:The big question by JHromadka · 2004-02-18 08:14 · Score: 2, Funny

Will Apple use a bit of additional money to pay back the money Microsoft invested in them back... oh, was it 5, 6, 7 years ago? That might revive the old OS wars, and make a lot of Mac fans (including myself) quite happy...
Bah. See my sig. MS sold their shares of Apple a long time ago.

--
"The objective of securing the safety of Americans from crime and terror has been achieved." -- John Ashcroft

It's true! by stephenb · 2004-02-18 07:14 · Score: 3, Funny

Apple's stock is up $.07, it must be true! ;-)

Re:It's true! by fembots · 2004-02-18 07:22 · Score: 1

then yesterday's SCO story must be truer :)

Up 2% $0.30

--
Rock that crushes, Paper & Scissors that don't matter.

It must be true! by Anonymous Coward · 2004-02-18 07:14 · Score: 0, Funny

Steve's name is on the memo!!

From the iPod Propels Apple Department by Wingit · 2004-02-18 07:14 · Score: 1

Is it just me, or am I seeing a new paradigm. Apple is partially being saved by the iPod. Windows NT and 2000 source code is released...er stolen and posted on the Net so it can be written off. Next I predict that Microsoft will be a huge player in VoIP with Xbox Live. Maybe its just me...

--
We win together or suffer without.

Re:From the iPod Propels Apple Department by avalys · 2004-02-18 07:20 · Score: 1

A new paradigm?! It's just you.

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This space intentionally left blank.
Re:From the iPod Propels Apple Department by coldnight · 2004-02-18 07:30 · Score: 2, Insightful

*why* would Microsoft make thier VoIP offering compatable with anyone else? They're the platform lock in vendor, remember? Soon there will be telephony, VoIP and XboxPhone... I fear.
Re:From the iPod Propels Apple Department by Wingit · 2004-02-18 07:36 · Score: 1

Well, thank you for the confirmation. I suspected it was just me. I still have an sinking feeling that as computers, entertainment systems, telephony and networking all converge into a blur, the Xbox might be a trojan horse holding the M$ attack on VoIP. As for Apple, I hope they are key to keeping M$ from being a powerhouse in the online music business. Apple deserves their success and I am really happy to see it. Now lets see Linux take the desktop while M$ is trying to get into everyone else's business. Congratulations Apple. I will buy stock next time they say Apple is going out of businss!

--
We win together or suffer without.

Insider trading. by Anonymous Coward · 2004-02-18 07:15 · Score: 0

Doesn't this sort of information represent insider trading? an "Internal memo"?? No verification? Hrmm.. something smells funny!

Good for Apple by stealth.c · 2004-02-18 07:15 · Score: 1, Interesting

If this is true, the future could be bright for Apple customers. With the company operating in the black now, perhaps there is a little leeway for prices to come down. Imagine a decked-out G5 costing the same as a similar Wintel box+monitor.

Heck, Apple may one day soon be in a strong enough position to risk porting OSX to other platforms. I believe that the sooner one's choice OS becomes irrelevant, the sooner real, healthy, competition can take place in this industry.

Re:Good for Apple by Anonymous Coward · 2004-02-18 07:24 · Score: 1

A G5 already costs about the same as dual-opteron workstation.
Re:Good for Apple by 0racle · 2004-02-18 07:30 · Score: 1

Well concidering that Apple is a Hardware company and doesn't make all that much on its OS, porting the MacOS to something that Apple doesn't make would be suicide for the company.

--
"I use a Mac because I'm just better than you are."
Re:Good for Apple by soapbox · 2004-02-18 07:37 · Score: 1

If this is true, the future could be bright for Apple customers. With the company operating in the black now, perhaps there is a little leeway for prices to come down. Imagine a decked-out G5 costing the same as a similar Wintel box+monitor.
If Apple stops making a profit (which is what the above sounds like), then we can expect their stock price to hit the toilet. Profit is what makes investors happy, not money in the bank. Apple can use the cash for R&D, advertising, or purchasing new software/hardware assets. They would be very wrong to cut prices by drawing down their cash reserves.

Similarly, while having options to put OS X on other platforms, Apple would also be cutting out the heart of its production: it makes a nice chunk of change on the hardware it sells. Making Darwin run on x86 is a nice gesture, and was probably a not-so-subtle message to Motorola, but IBM is really on board and producing serious chips these days--I'm not sure that "OS X86" is that good of an idea either.

I'd love to purchase a cheaper PowerBook or G5, of course! But I don't think Apple is willing to do that until their component prices drop.
Re:Good for Apple by madsenj37 · 2004-02-18 08:21 · Score: 1

If it aint broke, dont fix it. They made their money by not competing directly with microsoft and intel, etc. As long as they continue to profit, there is no reason they need to change their current business model. Dont get me wrong, cheaper macs would be nice, but they may not be (as) profitable for Apple.

--
Choosing the lesser of two evils is a choice for evil.
Re:Good for Apple by mbbac · 2004-02-18 08:41 · Score: 3, Insightful

Imagine a decked-out G5 costing the same as a similar Wintel box+monitor.
They already do.

--
mbbac
Re:Good for Apple by gobbo · 2004-02-18 10:51 · Score: 4, Insightful

Imagine a decked-out G5 costing the same as a similar Wintel box+monitor.
OK, I'm shopping right now anyway. I go to dell.ca and apple.ca and try to build equivalents.
Dell:
Dual Xeon 3GHz, 1GB RAM, 250GB SATA, modem, good keyboard low-end mouse, DVD+RW/CD-ROM, Audigy Soundblaster w/ firewire, ATI Fire GL X1 128MB, Win2K, no monitor:
$6,711 [CDN]
Apple:
Dual 2GHz G5, 1GB RAM, 250GB SATA, modem, Superdrive, Radeon 9800 pro, everything else standard, no monitor:
$5,044.00 [CDN]
OK so they aren't exactly equivalent. The Dell includes a floppy; the Apple's missing a mouse button. More, the Apple comes with optical sound connects, firewire800, and gigabit ethernet (no mention of the Dell's onboard networking in the summary). The Superdrive is way better than the Dell's DVD+RW. The Dell has a better video card by a bit. Some think that the Xeons would be faster but that probably depends heavily on application, and the g5's have a huge bus bandwidth. Not to mention other technology differences underneath it all, like case design and wireless integration. Oh, and, umm, bundled software and the operating systems.
Disclaimer: I'm comparing Apples and Dells because they're tier 1 manufacturers and people think Dells are cheap.
So, like, DUDE! why is the Dell costing $1600+ more than the Apple? Is it worth it? Which one is better made, longer lasting, which one is faster over all, which the better deal?

--
Damn those pesky terrorists
Re:Good for Apple by Sgs-Cruz · 2004-02-18 17:15 · Score: 2, Insightful

It's not so much the difference in price for the high-end stuff that matters. Apple equipment has a price vs. performance curve that starts high and is relatively shallow. Dell and others have one that starts very low but increases exponentially.

Yes, we know that the Apple curve is below the Dell curve for that fucking supercomputer you've spec'd out. But do the same comparison on equipment that would be okay for most home users, and it's a bit of a different story.

--
Karma: pi (Mostly due to circular reasoning in posts).
Re:Good for Apple by gobbo · 2004-02-18 19:12 · Score: 1

Yes, we know that the Apple curve is below the Dell curve for that fucking supercomputer you've spec'd out. But do the same comparison on equipment that would be okay for most home users, and it's a bit of a different story
True, but the grandparent post asked us to imagine a cheaper decked-out g5.
However, other factors come into play when considering value for most home users, who don't care about rendering speed: they want things to just damn well work like an appliance. Cheap Dells are, well, cheap and MS-laden, and you pay for junk later instead of up front. Price is no simple scale of comparison when there's little basis for equivalence. Even old used iMacs sell for more than those new bottom-end Dells, which is another measure of value -- they're worth it.

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Damn those pesky terrorists

Finacial Statements by AEC216 · 2004-02-18 07:15 · Score: 1

That would give Apple a stronger borrowing position with banks. Has anyone pulled their balance and income statements? Anyone here an Apple shareholder?

--
May I please have my frontal lobotomy if I bring back the ashtrays?

He forgot to mention... by Anonymous Coward · 2004-02-18 07:15 · Score: 0

..."according to the audit performed by Arthur Anderson" part.

How about me? by blackmonday · 2004-02-18 07:16 · Score: 3, Funny

An iPod, a 15 inch PowerBook, iLife '04, Panther... if only I could get debt free. Apple has me hooked, I can't believe how much cash I spend on their products. Well worth it though.

Cool! That puts them in a great position by kfg · 2004-02-18 07:16 · Score: 4, Funny

. . .to borrow capital.

KFG

Interesting for a public company by oliverk · 2004-02-18 07:16 · Score: 5, Interesting

Debt is very good for public companies (in fact it raises the valuation, mainly because of the tax ramifications on debt versus equity issuance). [note: I'm a first year MBA at Georgia Tech...so I'm speaking strictly academically].

It makes me wonder about Jobs' (or the CFO's) motivations. Strictly speaking, this would be the smartest move if Apple were to pursue a Leverage BuyOut (LBO), which is basically a reverse IPO. I can't see them doing this, but would give them a chance to radically reposition the company without requiring stockholder approval.

Just thinking out loud...

.

--
---- Please be nice in case my Slashdot karma ~= my real life karma.

Re:Interesting for a public company by Frankensloot · 2004-02-18 07:28 · Score: 1, Interesting

Spot on. IAAL (and a senior auditor in a past life) and that was my first thought as well.

Of course, we don't know this internal memo is necessarily true.
Re:Interesting for a public company by gmhowell · 2004-02-18 07:59 · Score: 1

Or they could be preparing to buy Pixar or any of a number of companies. Or to plunk it into R&D. Or something similar. Or perhaps they're ready to take on more loans. If they can go to a financier and show a history of paying back debt, profitability, and the willingness to do a large amount of equity financing, they'll get better loans at better rates.

Having fat cash reserves opens them up to many, many possibilities. And perhaps that freedom to move is why they are sitting on the cash.

Finally, the announcement itself will likely have a positive effect on stock price above and beyond what the change in the balance sheet would predict.

Sure, there are benefits to debt vs. equity financing, but IIRC, until that money does something other than sit there, it's sort of a Schroedinger's cat.

BTW, be careful admitting you are pursuing an MBA on Slashdot. It tends to hurt karma. (That's why I won't admit... Err, nevermind.)

--
Jesus was all right but his disciples were thick and ordinary. -John Lennon
Re:Interesting for a public company by Chiron+Taltos · 2004-02-18 08:05 · Score: 2, Interesting

Also thinking out loud ... could they be positioning themselves for new debt. Debt incurred from acquiring, or merging with, another company?

--
CT
Re:Interesting for a public company by Tenareth · 2004-02-18 10:44 · Score: 1

Buy Pixar? So, you have 2 companies and you buy 1 with the other... would seem a little... odd.

--
This sig is the express property of someone.
Re:Interesting for a public company by gmhowell · 2004-02-18 17:54 · Score: 2, Interesting

Jobs tends to make odd business decisions work.

I mean, seriously, *home* computers?

--
Jesus was all right but his disciples were thick and ordinary. -John Lennon
Re:Interesting for a public company by Anonymous Coward · 2004-02-18 18:18 · Score: 1, Funny

The bonds were due February 2004. Apple had no choice paying it off.
Maybe they teach that in the second year at Georgia Tech.
Re:Interesting for a public company by QuietKarma · 2004-02-18 20:56 · Score: 1

Buy Pixar? So, you have 2 companies and you buy 1 with the other... would seem a little... odd.

Didn't this happen to a little company run by Jobs called NeXT?

--
My job is to just stand there and smile :) My particular talent is that I make it look easy
Re:Interesting for a public company by Anonymous Coward · 2004-02-18 22:37 · Score: 1, Interesting

But the more interesting part is that they didn't re-borrow any more after paying the debt off, as far as we know.

interesting by Anonymous Coward · 2004-02-18 07:16 · Score: 0

Apple only had $3.7B in cash last quarter, but $6B in current assets.

http://www.sec.gov/Archives/edgar/data/320193/00 01 10465904003080/a04-1622_110q.htm

The secret by agentZ · 2004-02-18 07:16 · Score: 0, Redundant

1. Make neat looking computers/music players
2. (Previously ?????) Put them in cool colors
3. PROFIT!

that sounds right by theMerovingian · 2004-02-18 07:17 · Score: 5, Informative

according to their last sec filing, they had 300 million in debt and about 5 billion cash.

see this for details.

--
"If you think you have things under control, you're not going fast enough." --Mario Andretti

Re:that sounds right by DangerSteel · 2004-02-18 07:30 · Score: 1

according to their last sec filing, they had 300 million in debt and about 5 billion cash.
That sounds about right, since then I'm sure a few hundred users have paid for battery replacements in thier ipod...
Re:that sounds right by Anonymous Coward · 2004-02-18 07:30 · Score: 0

Mod parent up

Isn't this a bad thing? by Mr.+McGibby · 2004-02-18 07:17 · Score: 2, Interesting

From what little I know about finance, isn't this a bad thing? If their business ideas are good, then shouldn't they be taking out loans to expand their business? Debt-free may be good for normal folks, but for businesses, it isn't such a great thing.

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Mad Software: Rantings on Developing So

Re:Isn't this a bad thing? by transient · 2004-02-18 07:23 · Score: 1

Why take out a loan if you have the cash? Unless you enjoy paying interest, of course.

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irb(main):001:0>
Re:Isn't this a bad thing? by Chad+Page · 2004-02-18 07:24 · Score: 1

When you have $4 billion in cash, you can finance almost any kind of expansion you want (except for buying out companies with more than $4 billion in market value) - you *are* the bank.
Re:Isn't this a bad thing? by kalidasa · 2004-02-18 07:25 · Score: 2, Insightful

Not if they have enough capital on hand to expand as they wish. Remember debt means interest expense. If you can "borrow" the money from your own reserves, your only expense is loss on anticipated interest revenues, which is usually insignificant.
Re:Isn't this a bad thing? by Anonymous Coward · 2004-02-18 07:29 · Score: 1, Interesting

>shouldn't they be taking out loans to expand their business?

With interest rates as low as they are, normally, yes. But look at their operating margin:
http://finance.yahoo.com/q/co?s=AAPL
Wit h their current product mix, they are just scraping by.

It wouldn't take much to bump them into a quarterly loss. Then the leverage effect would work against them.

I think this is a prudent move for Apple.
Re:Isn't this a bad thing? by acfoo · 2004-02-18 07:53 · Score: 1

Why not pay the company's owners some dividends? This looks likely if they are sitting on that much cash. Also, having $3B in cash and market cap of $8.5B makes you a pretty prime takeover target. After all, you can do a leveraged buy out and cover the first $3B in leverage with the cash you acquire. If Apple has moved into the mature cash producer stage, it needs to start paying out dividends. Even Microsoft had to start paying dividends eventually
Re:Isn't this a bad thing? by Anonymous Coward · 2004-02-18 07:54 · Score: 0

growth for the sake of growth is the philosophy of the cancer cell.

maybe apple is content with their current volume?

MS long gone... by NotClever · 2004-02-18 07:17 · Score: 2, Informative

I believe that the money bought MS stock in Apple, which was sold pretty promptly.

--
Hell, there are no rules here. We're trying to accomplish something. - Thomas Edison

Addicted to OS X by MarkWatson · 2004-02-18 07:17 · Score: 4, Interesting

Since I am basically addicted to OS X, this is good news :-)

Apple has always had pricey, but cool stuff. I paid a premium for my Apple II (serial number 79 !! - I used it to write the free Chess program that was on the demo cassette for the Apple II).

I paid a premium for my first Mac in 1984.

Sometimes, more expensive products are just worth it.

-Mark

Re:Addicted to OS X by DR+SoB · 2004-02-18 07:27 · Score: 1

"I paid a premium for my first Mac in 1984.

Sometimes, more expensive products are just worth it."

So true, I mean, they even gave you a MOUSE! Could you imagine that? 1984, a MOUSE?! WOW! Forget the fact your mac had ~400K less memory then my XT, was ~2-4 Mhz SLOWER then my PC, and your floppies could only hold a fraction of the data mine did, but hey, the MOUSE makes it all worth while. Not to mention those K-RAD icons.

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Mod +5 Drunk
Re:Addicted to OS X by smart.id · 2004-02-18 07:38 · Score: 1

But it only had one button!

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blog & fiction: jd87
Re:Addicted to OS X by Anonymous Coward · 2004-02-18 08:31 · Score: 0

You had better than a 360K 5.25" floppy on an XT in '84. Right. I don't believe that the original 720K PC 3.5" floppies were widely available (ie, useful) until AT times. The original Mac 128K had a 400K 3.5" floppy that was quite a bit faster than your 5.25 as well.
Mhz ain't everything. The 68K was a hella lot better chip than the 8086, weaselnuts. Clock for clock it smokes a 8086. Less memory, but without all this near-pointer-far-pointer-memory-model bullshit. Flat addressing. Sane addressing of peripherals at the hardware level.
And yes, it had a MOUSE. Got a fuckin' problem with that?
Re:Addicted to OS X by DR+SoB · 2004-02-18 08:46 · Score: 0, Troll

U twit, I knew someone would be stupid enough to post something like this..

Okay, "Until AT Times"-> Guess what you twit, the 286 was released in 1984. Nice try, thanks for coming out.

Also, in 1984 IBM introduced "High Density" disks. 1.2 Megs per 5 1/4. :P That macs your 400K disks seem pretty, well, irrelevant.

"The 68K was a hella lot better chip than the 8086"

Actually your wrong, do to the rate of decent, gravity and all, if I dropped both chips from a building, they would hit the ground at exactly the same time. (Faster in what aspect you RETARD?!)

"weaselnuts"

Did you think of that yourself? It's "lame".

How anyone could think that in 1984 a mac had more power then an IBM PC, still amazes me. Guess these are the same people talking all the crap about the G4 now, huh?

Ohhh, Imac's are sooo cool. Look at the pretty colours.

I guess if your 12 yrs old, Mac's do seem pretty cool.. Kinda like wearing your pants around your ankles.

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Mod +5 Drunk
Re:Addicted to OS X by g-doo · 2004-02-18 10:37 · Score: 1

Ohhh, Imac's are sooo cool. Look at the pretty colours.

I don't understand why so many people prefer to live in a world without color. Do they feel discomfort around the colorful design that stands out so prominently? Perhaps people feel more comfortable blending with the crowd of the more mundate designs and colors of the PC world?

Besides, people should judge a Mac beyond the look of the computer.
Re:Addicted to OS X by DR+SoB · 2004-02-19 04:35 · Score: 1

"I don't understand why so many people prefer to live in a world without color"

What world exactly are you looking at?!?!

"Do they feel discomfort around the colorful design that stands out so prominently?"

Again, what world exactly are you looking at?!?

"blending with the crowd of the more mundate designs and colors of the PC world? "

Because my computer isn't PINK!?

"Besides, people should judge a Mac beyond the look of the computer."

If they did, there would be a hellva a lot less mac users!

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Mod +5 Drunk

Buy SCO? by clmensch · 2004-02-18 07:18 · Score: 3, Funny

Apple should buy SCO, and then drop all lawsuits. They'll "own" Unix (whatever that means), and they can help continue their commitment to the Open Source community.

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There is no gravity...the earth just sucks.

Re:Buy SCO? by EricWright · 2004-02-18 07:29 · Score: 4, Interesting

No. No. A thousand times no. Buying out SCO would just put more money into Darl's hands and the hands of his cronies. Is that what you really want? Personally, I want to see Darl McBride broke, homeless, and begging on the streets.
Re:Buy SCO? by Anonymous Coward · 2004-02-18 10:48 · Score: 0

I wouldn't wish what you "want to see" on my worst enemy. Take a pill, man.

According to their last 10-Q by timbob_com · 2004-02-18 07:21 · Score: 5, Interesting

Here is their last 10-Q they had a total of $2.6 Billion listed as liabilities and about $7 Billion in Assets (with almost $4.8 B being cash or short term investments) So this is definately possible.

I remember back to something Steve Jobs said back in 97 or 98 when asked how he was going to grow desktop market share. His response was something along the lines of 'We have 6% of the desktop market, Mercedes has 6% of the automobile market. Why aren't you predicting the end of Mercedes?'

iMac, iPod and iTunes really helped them accumulate some iCash.

Re:According to their last 10-Q by zach_smith · 2004-02-18 08:21 · Score: 2, Insightful

We have 6% of the desktop market, Mercedes has 6% of the automobile market. Why aren't you predicting the end of Mercedes?

Because the largest share of any automobile maker is <30%, whereas the market share of Microsoft in the OS market is >90%.
Re:According to their last 10-Q by Anonymous Coward · 2004-02-18 08:33 · Score: 0

All the more reason (especially in '97 or '98) for Microsoft to keep them around. Hard to argue you aren't a flaming monopoly when you've wiped out your flaming competitors.

Plausible based on last quarterly report by delphin42 · 2004-02-18 07:22 · Score: 3, Informative

http://finance.yahoo.com/q/bs?s=aapl

According to their balance sheet, they had $3.7B in cash as of Dec 27, 2003. At that time they also had a little over $300M in debt. The numbers add up with what is reported in the story, so I wouldn't say there is any reason to believe it isn't true. I would think that something like this would make a press release, but maybe they are waiting for the market close?

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-- Adam

Re:want confirmation? - SEC filling just happened by Lord+Haha · 2004-02-18 07:22 · Score: 3, Informative

The latest Filling was Feburary 10th, summmarized full My educated geuss since most filling as trimesterly about May 10th will be the next major SEC filling.

Debt isn't necessarily bad... by zymurgy_cat · 2004-02-18 07:22 · Score: 4, Insightful

Something to keep in mind is that debt isn't necessarily bad. Many companies use a combination of equity and debt to finance their operations. Sometimes no debt with lots of cash can actually be dangerous, particularly with the ongoing rise in leveraged buyouts. Granted, Apple is probably protected against this since there is very little to be gained by "breaking up" Apple. (I'd wager it's not even possible.)

It's how a company uses its debt and the amount of debt relative to things like cash flow, equity, etc., that's important.

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-- Fugacity: Confusing chemists since 1908

Debt management is a complicated game by pete_contact11 · 2004-02-18 07:23 · Score: 1, Insightful

Many people make lots of money just doing debt management. It's like a big complicated mathematical game, and often having debt and moving debt correctly can yield bigger returns than managing assets. I'm sure lots of smart people decided when and why to pay off their debt.

The people helping Apple get out of the debt... by Zedek · 2004-02-18 07:23 · Score: 1

Obviously hasen't seen this movie ;) Sure it's an oldie, but it's a goodie

Now They can Borrow Enough $$$ to Buy Disney. by skribble · 2004-02-18 07:24 · Score: 1

...or something like that

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--- Nothing To See Here ---

Seems reasonable by Dukael_Mikakis · 2004-02-18 07:25 · Score: 5, Informative

According to recent financial statements they did have about $302M in debt, and they had plenty ($3B) of "Cash" (or equivalents, which presumedly includes very liquid financial assets), so it seems reasonable that they would have paid it off. To be absolutely sure, I feel that we'd need to wait for the next batch of statements (March).

What they don't mention is that (of course) they have plenty of accounts payable. Not explicitly debt, they are still liabilities that are owed. No big deal, though, every company's got that.

I don't understand, though, why they're so eager to get rid of their debt. $300M isn't that much money (when they've got $3B cash, i.e.) and there's nothing wrong with a moderately leveraged firm (debt is of course usable capital, and they've effectively just lost $300M of "project money"), and I don't think that Apple was at any risk of defaulting.

If this debt was raised long ago (when rates were high), then I figure it's reasonable, but if this debt is recent, then it doesn't explicitly make sense to me (IANACFO), because that's cheap money for ... well, whatever Apple does.

To me, this seems to be an indication that Apple's going to be a bit more conservative and slow down new projects and products and such. When a company pays off debt, this must mean that interest rates cost more than the returns of the projects this money could finance.

This ranks Apple right up with Microsoft (since Microsoft started dividends a while back) as cash cow companies. I would be careful about buying.

Just my thoughts.br.

Re:Seems reasonable by Anonymous Coward · 2004-02-18 07:53 · Score: 0

It's not that they didn't WANT to pay off the debt (in this case, an issue of corporate bonds)... they had to WAIT until the maturity date on the issue to refund the money.

That, my friends, is what a bond is: DEBT.
Re:Seems reasonable by fupeg · 2004-02-18 07:55 · Score: 1

The debt was issued in 1994 and was paying interest at 6.5%.

Tell-tale signs by fembots · 2004-02-18 07:25 · Score: 2, Interesting

Seeing Pixar (Steve is the boss) just left Disney, and the steadiness (i.e. hardly any price drops) in Apple's product lines, it's obvious they're very confident, and most of the time, more money = more confidence.

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Rock that crushes, Paper & Scissors that don't matter.

German site, very /.'d by fsterman · 2004-02-18 07:26 · Score: 1

The site is german, and down. Google's cache is to old (can't find key german words mitteilung (memo)or Schuld (debt)) and the wayback machine is giving me errors. Any other cache?

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Is there anything better than clicking through Microsoft ads on Slashdot?

Confirmation - WSJ by blorg · 2004-02-18 07:26 · Score: 5, Informative

The Wall Street Journal (right arm & shirt off back required) reported last month that Apple were planning to pay off the rest of their debt when it was due on Feb 16. So I'd be surprised if it wasn't true. MacMinute have a summary.

Re:Confirmation - WSJ by dasmegabyte · 2004-02-18 09:09 · Score: 1

Just because it's in the WSJ doesn't make it true. Do some searches on "Enron" and "2001" and see what you find.

Oh, and some of their editorials aren't even based on reality. Seriously, you look at some of the speculation those cats do, and you start looking for the woman in the red dress.

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Hey freaks: now you're ju

Now they can drop their prices! by ivanmarsh · 2004-02-18 07:27 · Score: 1

I'd love to have a G4 system... but there's no way I'm paying what they've been asking for them.

In other words by Anonymous Coward · 2004-02-18 07:28 · Score: 4, Informative

They developed a game console that didn't make money, but they weren't stupid enough to make it.

Re:In other words by generikz · 2004-02-18 17:02 · Score: 1

One is on eBay currently (not my auction), just for your information:

Pippin with full pictures

Rgds,
Julien

As opposed to Red Ink Republicans? by DrMorpheus · 2004-02-18 07:29 · Score: 5, Insightful

Since the Bush Administration and the Republican dominated Congress has managed to outspend every liberal administration/Congress since the beginning of the twentieth century.

But you go right ahead and keep the faith. Obviously reality isn't bothering you enough to change your thinking.

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Debunking the "59 Deceits"

Re:As opposed to Red Ink Republicans? by bfg9000 · 2004-02-18 07:46 · Score: 1

you're an idiot.

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I'm not normally an irrational zealous dickhead, but I figure "When in Rome..."
Re:As opposed to Red Ink Republicans? by Elwood+P+Dowd · 2004-02-18 07:53 · Score: 1

Since the Bush Administration and the Republican dominated Congress has managed to outspend every liberal administration/Congress since the beginning of the twentieth century.

Interesting point. When you say "every liberal administration/Congress" do you mean every time we liberals have held both branches of the federal government, or do you mean every time we liberals have held either of the branches of the federal government?

The first scenario has only happened very rarely and would not surprise me at all. It also isn't saying anything particularly interesting.

The second scenario would be interesting, and if that's what you're saying, I'm interested to know where you got that factoid.

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There are no trails. There are no trees out here.
Re:As opposed to Red Ink Republicans? by Abcd1234 · 2004-02-18 07:55 · Score: 1

Damnit! *shudder*
Re:As opposed to Red Ink Republicans? by Short+Circuit · 2004-02-18 07:55 · Score: 1

Including WW and FDR during the world wars? And including inflation?

I'd love to get my hands on those numbers and wave them in the face of someone I know. Of course, she'll spout "But it's for national security!"

--
tasks(723) drafts(105) languages(484) examples(29106)
Re:As opposed to Red Ink Republicans? by SphynxSR · 2004-02-18 09:09 · Score: 1

I agree why spend anything to protect this country. Not like anyone is going to do anything to us.

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I don't suffer from insanity, I enjoy every minute of it.
Re:As opposed to Red Ink Republicans? by be-fan · 2004-02-18 09:26 · Score: 4, Interesting

Numbers:

US Budget Summary since 1789
Inflation calculator.

Okay, the largest budget deficit of the 1930's (Great Depression, New Deal) was about $3bn in 1939. That's about $31bn in 2002 dollars.

The largest budget deficit of the 1940's (WWII) was $55bn in 1943. That's about $585bn in 2002 dollars.

The largest deficit of the 1960's (Soviet Union, Space Race) was $25bn in 1968. That's $130bn in 2002 dollars.

The largest deficit in the 1980's (Soviet Union) was $221bn in 1986. That's $354bn in 2002 dollars.

The largest deficit of the 1990's (Iraq war?) was $290bn in 1992, which is $370bn in 2002 dollars.

The 2004 budget deficit is officially $521bn. However, that does not count the costs of war, which are $84bn in Iraq alone. All told, the current deficit is well over $600bn. Depending on the cost model, that equates to about $580bn 2002 dollars.

So in any case, the current US budget deficit is not larger than at least the one FDR carried, but its skirting damn close.

--
A deep unwavering belief is a sure sign you're missing something...
Re:As opposed to Red Ink Republicans? by Anonymous Coward · 2004-02-18 09:53 · Score: 1, Informative

Bad, bad, mod down, wave off, do not follow link, bad, bad, bad. You've been warned. I hit this while eating Gordon Biersch garlic fries, and suddenly they aren't quite as super-tasty as they were a minute ago. In a word, this link 'sucks'.
Re:As opposed to Red Ink Republicans? by keno1929 · 2004-02-18 10:38 · Score: 1

you could say that, but then the budget compared to the total GDP looks a lot differet...you can't look at numbers you have to look at indexes, then the whole picture changes.
Re:As opposed to Red Ink Republicans? by xenocide2 · 2004-02-18 10:47 · Score: 1

Unless international warfare is in your bundle of goods used to normalize inflation, it hardly seems appropriate to model budgets from decades to a century ago in today's inflation adjusted dollars.

--
I Browse at +4 Flamebait
Open Source Sysadmin
Re:As opposed to Red Ink Republicans? by Anonymous Coward · 2004-02-18 10:57 · Score: 0

Hey, we own Iraq, don't we?
Re:As opposed to Red Ink Republicans? by Anonymous Coward · 2004-02-18 11:25 · Score: 0

Yea, because spending money equates to your country becoming safer.

After all, you've been spending money making the country safter from those evil Drugs for over a decade now, and we all know how well that worked.
Re:As opposed to Red Ink Republicans? by KarmaMB84 · 2004-02-18 12:19 · Score: 1

All he's doing is showing old deficits in adjusted dollar values. No matter the cause, prices in consumer goods changed and that is inflation. War doesn't even enter into it except indirectly.
Re:As opposed to Red Ink Republicans? by KarmaMB84 · 2004-02-18 12:26 · Score: 1

And if spending money doesn't stop the terrorists from getting in, we can give up and let them in too!
Re:As opposed to Red Ink Republicans? by Anonymous Coward · 2004-02-18 13:29 · Score: 0

Of course, the current budget deficit includes liberal money-wasting travesties like social security, as well as RIR programs. So feel free to accredit 15% or so of the current deficit to FDR's legacy.
Re:As opposed to Red Ink Republicans? by Anonymous Coward · 2004-02-19 01:22 · Score: 0

If you've numbers, I've questions. Does the inflation-adjusted budget you quote for FDR's term include costs for WW2?

If it does, then this is an apples-to-oranges comparison. (adjusted $580bn with a war in Iraq vs adjusted $585bn for a WORLD war)

If it doesn't, then bravo, the budget deficit isn't the biggest one EVER, but it's still a bit out of control.
Re:As opposed to Red Ink Republicans? by iceperson · 2004-02-19 04:15 · Score: 1

FDR's deficits were much larger in proportion to GDP no matter how you cut it. How do so many Dems go through life with no basic understand of macroeconomics?
Re:As opposed to Red Ink Republicans? by xenocide2 · 2004-02-19 16:33 · Score: 1

Inflation is one thing, and real. But how do you measure inflation? Inflation is measured most commonly by consumer price index(CPI). In CPI, the cost of a bundle of goods at a retail store is used to caculate inflation. It doesn't consider what people buy today, or new products. As such its highly dependent on the goods selected and how much of each good is to be purchased. CPI is what is commonly used in "inflation" calculators.

My point was that the kinds of expenses in a budget aren't usually in such a measure of inflation, and that historical data on the subject can be quite flawed.

--
I Browse at +4 Flamebait
Open Source Sysadmin
Re:As opposed to Red Ink Republicans? by SphynxSR · 2004-02-20 13:39 · Score: 1

Yea, we are trying to stop drugs from killing children and we are the wrong ones. Hey have another eight ball. And suck a cock to pay for it, when it because the most important thing in your life. But hey that couldn't happen to you right.

--

I don't suffer from insanity, I enjoy every minute of it.

According to recent financial statements by Anonymous Coward · 2004-02-18 07:29 · Score: 0

According to recent financial statements Apple has made massive profits on replacement batteries for the ipod.

Re:According to recent financial statements by MuckSavage · 2004-02-18 07:42 · Score: 1

Sure are a lot of ANONYMOUS COWARDS posting THE SAME THING in this story. Interesting.

This is good news for all computer users. by newdamage · 2004-02-18 07:31 · Score: 5, Insightful

Regardless of your choice of architecture or OS, this news is great for consumers and technology users. I may not use a Mac, but as long as Apple is out there, out of debt, and profitable I don't have to worry about Microsoft having free reign over the direction of the computer industry. XP Pro works fine for me right now when I need to get real work done (sidenote: please, Linux, work completely on laptops soon!), but if Gates & Co. decide to slide farther down some restrictive draconian path of DRM I know that I can switch in a heartbeat.

We all saw what happened when AMD became a viable competitor for Intel, processor speeds dramatically increased and prices dropped.

Without Apple continuing to innovate and capture user mindshare we'd all probably be stuck using something along the lines of Windows ME.

--
ce n'est pas un Sig.

Re:This is good news for all computer users. by GrahamCox · 2004-02-18 09:31 · Score: 2

Without Apple continuing to innovate and capture user mindshare we'd all probably be stuck using something along the lines of Windows ME.

No, without Apple continuing to innovate we'd all probably be stuck with the C:/ prompt, text displays (with maybe a graphics mode you could switch to for the odd spreadsheet graph), and an internet based on Lynx. I bet M$ would never have even thought of the GUI without Apple showing how it could be done.

good insights from Feb 3 article by octalgirl · 2004-02-18 07:31 · Score: 4, Interesting

The article

"Let's do the math: According to its latest earnings report, Apple averaged $349 in revenue per iPod sold. If prices remain stable, 3 million iPods would generate more than $1 billion in revenue. Four million units could produce $1.4 billion in sales. Apple sold $345 million in iPods during fiscal 2003.

Turning the dial to iTunes, Apple says that more than 30 million songs have been sold to date, with 17 million of those coming during the Christmas quarter. The Pepsi promotion should dramatically increase iTunes traffic. Add in the help from HP and paid downloads could pass 100 million during 2004. At that level, Apple should make a few pennies per song, up from zero now."

Re: good insights from Feb 3 article by AaronD12 · 2004-02-18 08:13 · Score: 2, Insightful

...Apple averaged $349 in revenue per iPod sold.
That's particularly impressive since the iPod sells for $299 (15GB), $399 (20GB), and $499 (40GB). Even if Apple only sold the 40GB iPods, the $349 per unit revenue would be more than a 200% markup over cost. If that's true, why haven't other manufacturers been able to undercut Apple more significantly?
Being that the median price of the iPod (not sales-weighted) is $399, I can't believe it only costs $50 to make an iPod.
Re: good insights from Feb 3 article by aclute · 2004-02-18 08:37 · Score: 1

Because revenue != profit

microsoft and telecommunications... by kalemba · 2004-02-18 07:32 · Score: 1

the evening of the debut of xboxlive, i happened into an nfl fever game with a microsoft employee who was playing at the launch party. i was a beta tester for xboxlive, so we were chatting about it a little and he pointed out during the conversation that with the launch of the service microsoft became one of the top 5 (i think he said top 5, i had been drinking) telecommunications carriers in the usa.

They still owe me! by Perl-Pusher · 2004-02-18 07:32 · Score: 3, Funny

One ibook logic board! When I get my ibook back only then will the debt be paid!

The Wonders Of Spam by Ilan+Volow · 2004-02-18 07:33 · Score: 5, Funny

Steve Jobs must have replied to one of those anonymous e-mails titled "GET OUT OF DEBT NOW".

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Ergonomica Auctorita Illico!

Re:The Wonders Of Spam by Anonymous Coward · 2004-02-18 13:09 · Score: 0

Or maybe he knows something we don't and he's the one sending out the mails. I think Im going to reply to 5 right now.
Re:The Wonders Of Spam by bruthasj · 2004-02-18 13:31 · Score: 2, Funny

It was actually an influx of cash via a Swiss bank account held by the nephew of the late king of Nigeria. Steve finally alleviated them of their financial burden.

Out of curiosity... by bmac · 2004-02-18 07:34 · Score: 1

Doesn't Microsoft have something like $27 billion in the bank? Or am I way off here?

Peace & Blessings,
bmac
www.mihr.com: for *all* the answers

Get out of debt! by markov_chain · 2004-02-18 07:34 · Score: 2, Funny

If companies with $4B in cash are responding to spam, we don't have a chance... Allman is right!

--
Tsunami -- You can't bring a good wave down!

InternalMemos.com has the real memo by smart.id · 2004-02-18 07:34 · Score: 4, Informative

If in fact it is the real memo, InternalMemos.com (from the same people who brought you FuckedCompany) has it. It just looks kind of suspicious because of how short it is, but that very well may be it.

--
blog & fiction: jd87

Re:InternalMemos.com has the real memo by Anonymous Coward · 2004-02-18 07:47 · Score: 0

Why bother going to some other site, when you get it indirectly from Slashdot!

- - -
Today is a historic day of sorts for our company. When I arrived back at Apple in mid-1997, the company was burdened with $1 billion of debt. Through everyone's hard work we turned Apple around, paid off the majority of our debt and began to amass a war chest of cash in the bank which has grown to about $4.8 billion! But there was still $300 million of remaining debt, which we decided to hold to maturity.

Today we used $300 million of our cash to pay off this remaining debt.

Apple is now a debt-free company - for the first time in over a decade!

It sure feels good.

Steve
- - -

Re:Bad - Enterpise Value by MerlynEmrys67 · 2004-02-18 07:36 · Score: 4, Informative

So lets figure out how this works...

Lets assume I want to buy Apple - all of it

First I buy all of the shares

Now I get access to their bank account - if the company has net debt (see Disney) I have to pay that off (either through loan payments, or through other means)

If the company has net cash (see Microsoft) I can take that money and do whatever I want with it

So Enterprise value of a company is

The cost of all of the shares of stock

Plus the debt of the company

Minus the cash/etc. of the company

End result is paying debt off from cash is a net wash on enterprise value because the cash is smaller, but the debt is as well.

End result is I prefer companies with smaller debt loads - it is easier to predict their earnings (every penny they make goes to profit, not debt service) however companies with large debt loads can have huge swings in earnings because the first 10 bucks they make go to debt service, and every penny beyond that goes to profit - so a small change in profits look a lot bigger (compare 10.02 to 10.01 dollars vs. 0.02 vs 0.01 as a percentage)

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I have mod points and I am not afraid to use them

Solvent debt free by TopShelf · 2004-02-18 07:36 · Score: 1

In these days of historically low interest rates, you can make a very good argument that Apple is making a bad move in paying off this debt. While they will save interest, could they not have spent this money in better ways, i.e. growing the business or increasing the payout to shareholders?

--
Stop by my site where I write about ERP systems & more

This is a bad thing by bellings · 2004-02-18 07:37 · Score: 0, Interesting

Interest rates right now are at an all-time historical low. If they really did pay off the debt, this is Apple's way of telling investors:

There is no way we can use that $300 million to make more than a 3% return. We're out of ideas. Done. We may as well just dissolve the company now and give everyone their money back, because you could do better investing in turnip futures.

There may be valid reasons Steve Jobs doesn't want to be in debt. I have no way of knowing how that debt was structured. Jobs was already forced out of the company once, and he might be trying to avoid that happening again. Or, Jobs may be betting on long term interest rates spiking in the next 6 to 12 months. Or, maybe he met George Soros at a coctail party. Who knows.

But, financially, this isn't good news.

--
Slashdot is jumping the shark. I'm just driving the boat.

Re:This is a bad thing by Ill_Omen · 2004-02-18 07:49 · Score: 2, Insightful

Just because interest rates are low now doesn't mean they were low when Apple took out the loan that they paid off, does it?

I can imagine (read: I have no real idea) that the interest rates charged to a struggling company that many people have given up for dead (ie Apple before the iMac) are quite high.
Re:This is a bad thing by Violet+Null · 2004-02-18 08:16 · Score: 1

But, financially, this isn't good news.

And why not?

Apple has $4.8 billion cash. Why keep around another $300 million that you're paying interest on, when it's obvious that you have all the money you need right now?

Sure, Apple could've taken that $300 mil and invested in R&D or what have you...but they have plenty of money to do that with after paying off the debt. I'm not seeing the point of keeping it around when you have so much cash.
Re:This is a bad thing by JohnsonWax · 2004-02-18 08:28 · Score: 1

No. This is Apple's way of telling investors:

There is no way we need $300M to finance ideas that the remaining $4.8 billion can't already handle. If we do need more money, interest rates are near an all time low so we'll just borrow it back or blackmail MSFT again. In the mean time, why pay the interest since it'll have negligible tax effect against earned interest on $4.8B.

More than anything I think it means that Apple doesn't see any investments that are guaranteed winners above 3%. If they already have that kind of war chest at their disposal, does an extra $300 million really get them anything?

Apple and Fred have been clear for some time that the war chest allows them to buy revenues. If Maya was in fact up for sale, Apple should have no problem writing a check for it. Apple can in fact write a check for either ATI or Nvidia if they really wanted to be in that market. They have options and are being judicious in how they use it.
Re:This is a bad thing by prockcore · 2004-02-18 08:55 · Score: 1

The $4.8 billion isn't just sitting in the bank, it's being used. It's called a capital budget, and much of it has probably been earmarked.

How much do you think it costs Apple to run a business for a year? Those costs come out of capital, straight out of that $4.8 billion.
Re:This is a bad thing by jjohnson · 2004-02-18 09:07 · Score: 1

Good point, except that their debt was far less than cash-on-hand, which earns much less than 3%. Paying interest on debt while hanging onto cash earning less than that interest rate is less intelligent than paying off debt at a lower interest rate than investing it.

This was cleaning up a corner of the financial statements, for good PR.

--
Anyone who loves or hates any language, platform, or manufacturer, doesn't know what they're talking about.

Re:Enough already by hambonewilkins · 2004-02-18 07:37 · Score: 1

Actually, considering how old this cliche is, I bet he answers the phone with "Where's the beef?"

--

God Bless America. Why? Did it sneeze?

Apparently... by BlowChunx · 2004-02-18 07:40 · Score: 1

1 Infinite Loop does not require infinite payments.

Thanks....I'll be here all week.

Re:want confirmation? - SEC filling just happened by RazzleFrog · 2004-02-18 07:41 · Score: 5, Insightful

Most filing is quarterly not trimesterly. Their second quarter reports have historically been published in the middle of April.

I am not the grandparent by Anonymous Coward · 2004-02-18 07:42 · Score: 0

...but the short version is that debt is cheaper than shareholders.

Uh... No by coolmacdude · 2004-02-18 07:42 · Score: 1

They mean $4.8 billion, part of which is earmarked for salaries in the next quarter, part of which is for office space, maintainance, etc, part of which is for production of new units, part of which is for research and development

Wrong. That money is not for operating expenses. Apple usually earns 1-2 billion in revenue every quarter. That's what they pay those things with. The 4.8 bil is reserve that is supposed to sit there to earn interest. Besides not all of it is cash anyway, some is in investments.

--

-You may license this sig for only $6.99.

Why?? by daperdan · 2004-02-18 07:44 · Score: 0, Flamebait

Why does Slashdot always pat Apple on the back for everything? They appear to take the best of the Open Source world and give nothing in return. To this day I can't run their quicktime movies on Linux:
http://www.apple.com/quicktime/download/

I don't see a Linux option here. Also missing is a BSD download.

You see countless posters protesting SCO's use of Apache and Samba yet very little is said of Apple charging 500 bucks for a server OS that is almost 100% open source with their fancy gui on top. Have they donated any of those management tools? No. What has been their contribution? Hardly anything...

In a way they are worse that Billy Gates and his crew. They turn their company around by taking advantage of the blood sweat and tears of the Open Source programmers and don't give anything back.

I know I'll get flamed for this but I need to vent my frustrations. Don't try and tell me that Darwin is their contribution because we all know it's crippleware.

Re:Why?? by Anonymous Coward · 2004-02-18 08:10 · Score: 0

While it is true that dumb apple zealots who have got money to burn on expensive cheese graters and think apple is god (thats why apple can get away with EXTORTING their users with annual $129 payments, while if microsoft charged one cent for a service pack they would be burned to ashes!), Apple isnt 100% leaches. They have contributed one useful thing back to the community, and that is webcore! KDE 3.2 has greatly benifetted from the contributions and now KDE is more advanced and easier to use than Mac OS X itself. Try it today if you havent.

Also, It IS possible to watch quicktime movies in Linux, its just that Apple dosent support it. Try mplayer it supports Quicktime movies!

Anyway, Apple does suck mostly and I think apple zealots should try Linux instead! If you use OSX, switch to Linux today, you can even get a version for you mac!
Re:Why?? by thelasttemptation · 2004-02-18 08:41 · Score: 1

To this day I can't run their quicktime movies on Linux:

here's the correct url for this
http://www.mplayerhq.hu/

There, quicktime on linux.

Don't try and tell me that Darwin is their contribution because we all know it's crippleware.

Hrm... Looks like a full bsd distro to me, just no aqua. So I guess all BSD's are crippled?

I know I'll get flamed for this but I need to vent my frustrations

Why? Was it *your* work that they "took"? If you write code and release it in a licence that allows Apple to do this, is it's Apple's fault? Not in my book bub, it seems to me that Apple is doing the right thing for them as a company, for their investors and for the people who want the product Apple is selling. To me it seems like you just are a bit jealous of Apple for some unknown reason, maybe you just can't afford one?

Anyway, IMNSHO, fuck off...
Re:Why?? by Mr.+Darl+McBride · 2004-02-18 08:51 · Score: 1, Interesting

Why does Slashdot always pat Apple on the back for everything?
There's a LOT more advertising money in Mac products than in Linux products however, so I'm sure OSDN is at least partially obliged to cater to and support pro-Mac opinions and interests.
This isn't a bad thing. There's a siginficant overlap in Linux and Apple interest, especially since Apple went UNIX with Mac OS X (an excellent move on Apple's part). So the content is quite relevant.
Re:Why?? by zpok · 2004-02-18 09:18 · Score: 1

They appear to take the best of the Open Source world and give nothing in return.

Please to look into the history of NeXT and draw better founded conclusions, yes?

NeXT and Apple have given plenty and have developed even more. You're very much misinformed and needlessly emotional about this me thinks, yes yes.

--
I think, therefore I am...I think.
Re:Why?? by Trejkaz · 2004-02-18 16:54 · Score: 1

So what you're saying is OSDN are a bunch of money-grubbing bastards. Which I would tend to agree on, because of the vertical advars which break up the site worse than a long line comment.

--
Karma: It's all a bunch of tree-huggin' hippy crap!

CFO Fred Anderson is Retiring in June by good+soldier+svejk · 2004-02-18 07:45 · Score: 5, Interesting

I guess Fred feels his work is done now, because he is calling it quits on June 1. Anderson has been instrumental in solving Apple's financial problems from the day Gil Amelio hired him in 1996. He created the company's large cash reserves by liquidating unnecessary capital investments (plant), issuing a convertible debenture and selling some of their valuable ARM holdings. Then he managed the investment of those funds astutely enough to make the conversion of those outstanding notes to common stock a huge win for both the company and creditors. That 1999 conversion alone eliminated about two thirds of Apple's long term debt (conversely that means the issue had assumed most of Apple's debt). Really, this guy has done an outstanding job. You can thank him for their sound financials.

--
It is cowardly, and a betrayal of whatever it means to be a Jew, to act as a white man

-James Baldwin

ok, so... by pb · 2004-02-18 07:45 · Score: 5, Interesting

Apple's got like $5 billion in cash lying around, Microsoft has $50 billion or so last I heard... Just to put this into perspective, $50 billion dollars is about $166.67 from every man, woman, and child in the US, or about enough for them each to buy a copy of Windows retail (or almost two upgrade editions or full OEM editions). It's almost equal to the GDP of Iraq in 2002. You could hire a million people full-time with that money and pay them $25/hr for a year. It's a lot of money.

The profit margin on software is about as high as a profit margin can be, and even when you consider that they spend money on R&D, salaries, advertising, buildings, manufacturing, computers, etc., etc. -- that's still an enormous mark-up from the market value of their products. (They both sell hardware too, and in Apple's case, there's a hefty mark-up on that as well, especially RAM--but not nearly as much as there is on software.)

So it'll be interesting to see what happens, as Microsoft slashes prices on core offerings to compete with Linux, and newer desktop environments and toolkits are developed across the board to compete with Apple. Still--I don't know about TCO, but there should be no doubt in your mind that these companies are overcharging. :)

--
pb Reply or e-mail; don't vaguely moderate.

Re:ok, so... by prockcore · 2004-02-18 08:58 · Score: 2, Insightful

Apple's got like $5 billion in cash lying around, Microsoft has $50 billion or so last I heard

A little more perspective: Nintendo has $10 billion in cash.
Re:ok, so... by timothy · 2004-02-18 09:00 · Score: 1

"that's still an enormous mark-up from the market value of their products."

How are you defining "market value"? :)

timothy

--
jrnl: http://tinyurl.com/c2l8yr / foes: http://tinyurl.com/ckjno5
Re:ok, so... by pb · 2004-02-18 09:09 · Score: 1

What the value should be in a competitive market, vs. what it actually is... Maybe that was a sloppy way of putting it.
"Another situation, where the free market may not operate in the best interest of society is in a monopoly situation. A monopoly is a situation where the free market ultimately led to dominance by one large firm either through luck, innovation, and savvy or illegal business practices. It has been determined by economists that a monopoly will create a situation in which we are operating at a point on the supply-demand curve that is sub-optimal. More specifically, it is at a point above equilibrium. At this point, prices for products or services are higher than they would be in a perfectly competitive economy; fewer goods are being produced; and the monopolistic firm is enjoying above normal profits (Case and Fair). All of this happens at the expense to society. Without Government intervention, the monopoly would continue to enjoy its dominant position for as long as the factor that brought it to dominance continues to exist. The Government can intervene by ordering the firm to take specific actions or a bide by certain rules to improve competition in the industry. Microsoft is a well-known example of such a case where it was ordered by the Government to take specific steps to allow others in the industry to have a better chance to compete."
-- The Two Sides of the Invisible Hand

--
pb Reply or e-mail; don't vaguely moderate.
Re:ok, so... by ducomputergeek · 2004-02-18 11:39 · Score: 1

Actually, it depends on volume. Some larger companies can purchase Windows, Office, et. al. for as little as USD 10 a copy. Granted they buy 100,000 copies at a time, but still.
I switched to Linux and then from Linux to Mac about 2 years ago because at the end of the day I wanted something that worked.
Linux's greatest strength is its flexablity and its greatest weakness, flexablity. I worked for a company once that looked at porting some it its tools to Linux. However, they looked at the costs of having to support different vendors. They did a test run of saying, "We'll only support Red Hat", and all the SuSE and other crowds bitched, then came the point of, "What GUI are we going to support?" We selected Gnome, all the KDE people wrote in and complained, and after three months the decision was made that Linux was not a viable option at this time. That was three years ago.
Until a clear defacto standard emerges, Linux is not going to be a viable option.
Now I say this as our last Linux box was retired from service this week and we are now running 100% BSD including Macintosh on Desktops. Sorry, but until tools like Adobe Photoshop, Macromedia et. al., and easy to use iLife apps are available for Linux, Macintosh is going to rule in several areas.
That said, I have had many clients swiching to Macintosh for their small offices. We go to meetings and someone is dealing with this weeks worm, and they ask us how we deal with the problem, and we reply, "We don't have too, we run Macs." And wait for their disgusted look or one of amazement. The amount of time and money we've saved using Macs over Windows and even Linux PC's have more than paid for their higher upfront costs.

--
"The problem with socialism is eventually you run out of other people's money" - Thatcher.

Re:Solvent debt free by notbob · 2004-02-18 07:47 · Score: 1, Insightful

When you have 5 billion in hand... why would you not want to pay it off? As they have plenty to play around with / invest with, it is a very smart move to not waste money on interest.

debt = leverage by Anonymous Coward · 2004-02-18 07:48 · Score: 2, Interesting

Debt can be a good thing, for reasons other than taxes.

Debt is the basis of leverage. Example: I have 1 million dollars. I buy a house for 1 million dollars. The house appreciates 10% in a year, and now I just made $100,000 off my investment. However, lets say you put down $100k on the 1 million dollar house, and the house still appreciates 10%. You just made 100k w/ 100k for a 100% return on your investment. Had you done that w/ ten other houses, you doubled your net worth. Of course, there would be a cost associated with borrowing that kind of money. Youre ahead as long as your cost of borrowing does not exceed your rate return. It gets alot trickier, and generally tilts the balance in favor of taking on alot of debt when you bring tax benefits into the picture. In the case of a house, the mortgage interest is deductible, so money is essentially 30-40% cheaper to borrow than whatever interest rate you are paying. Also, inflation eats away at your debt costs.

Of course your risk is alot higher. During good times, you can make a killing. But if the values of your assets start falling, you can quickly lose your shirt, and then some. in the 100k down on 10 houses scenario, a 20% drop in asset value would put you in the hole about 1 million (thats a net value of -1 million) as opposed to the opposite scenario where you are still worth 800k.

Duh? by Anonymous Coward · 2004-02-18 07:49 · Score: 0

You are implying the debt they just paid off is a recent low-interest debt. It probably is not.

You are implying they will not borrow now, which they most likely will do.

since when is it a bad idea to pay off a high interest loan with cash in exchange for the opportunity to be debt-free and to borrow more at lowered rates?

Re:Duh? by TopShelf · 2004-02-18 07:56 · Score: 1

If you check out their balance sheet, you'll see that this is short-term/current term debt, as opposed to long term debt (which they haven't carried in a while). This, it is highly likely that this is low-interest debt.

Unless of course, they were late a couple times paying their credit card, in which case it's probably 24.99%!

Swapping high-interest debt for low like you mention can indeed be a good move (GM just did this last year), but that's not what's happening here.

--
Stop by my site where I write about ERP systems & more

I bet he got it by Bendebecker · 2004-02-18 07:50 · Score: 0

by ripping off the Woz. $300 million, that's what, a couple 1,000,000 Breakout machines...

--
There's a growing sense that even if The Future comes,
most of us won't be able to afford it.
-- Lemmy

it's worth it by bsDaemon · 2004-02-18 07:52 · Score: 1

I bought the brand new iBook G4 12" in October the week they released them. It's the best computer I've ever own, including my eRacks 1.2Ghz/1GB RAM BSD workstation.
I'll never go back to "PC" hardware. I'm hooked and that'st that.

That said, I did get it at a student discount, and bought the low end model (800Mhz, 256MB RAM, combo drive) with only adding the AirPort Extreme card. I'd love to have gotten a PowerBook, but I just don't have the money. However, if i weren't a student, or even had a part time job, i'd probably have financed one.

Apple is expensive, but it's worth every cent.

Correction by I8TheWorm · 2004-02-18 07:54 · Score: 5, Insightful

Just a quick correction (not a Troll... I'm glad they're doing well)...

Also noted in the memo is that Apple has $4.8 billion in the bank at this time.
and
Apple has $4.8 billion in total assets

Are not synonymous. Assets include buildings, machinery, office equipment, which I'm sure Apple has laying around somewhere...

--
Saying Android is a family of phones is akin to saying Linux is a family of PCs.

Re:Correction by Tide · 2004-02-18 08:06 · Score: 1

It's unclear what you are correcting. The memo clearly states 4.8 billion of "cash in the bank".

--

People think Microsoft is the answer. Microsoft is just the question, "No" is the answer.
Re:Correction by jlockard · 2004-02-18 08:12 · Score: 1

Total assets would include money you have in the bank. Apple isn't renting everything in their possession, so of the two numbers, total assets should be higher than the "in the bank" number.

--
--JLockard - "Some mornings, it's just not worth chewing through the leather straps." - Emo Phillips
Re:Correction by I8TheWorm · 2004-02-18 08:20 · Score: 1

Sorry... I snagged that off of the following...

Apple has $4.8 billion in total assets

--
Saying Android is a family of phones is akin to saying Linux is a family of PCs.
Re:Correction by Tide · 2004-02-18 08:25 · Score: 1

I understand the point, just not what they were correcting. The memo at no point in time states anying reguarding assets and neither does the slashdot story or the article that was linked to.

--

People think Microsoft is the answer. Microsoft is just the question, "No" is the answer.
Re:Correction by Tide · 2004-02-18 10:17 · Score: 1

MacNN is incorrect. If you read the actual report:

Apple Financial Statements

You'll see $4.8 billion as of Dec 2003 in cash and investments, and $7.0 billion in total assets.

--

People think Microsoft is the answer. Microsoft is just the question, "No" is the answer.

Re:Interesting for a public company.. HA HA by acomj · 2004-02-18 07:54 · Score: 2, Interesting

I work for a company with huge debt (100s of millions$$). We're in the pay it back stage vs the borrow and grow stage. Its not good. It takes a huge chunk of our profits and some of the purchases didn't work out as well as expected. It hasn't helped our valuation...

Actually Corporate debt is not a Bad Thing by D-Fly · 2004-02-18 07:54 · Score: 3, Interesting

You have to be careful about conventional wisdom when it comes to economics.

Here's a pretty good case study from the Motley Fool on why taking on corporate debt is often better than trading away shares to make acquisitions. Basically, in this case, taking on a lot of debt is fine if it increases cash flow.

In general, if a company's risk rating is good, you could say that it is in fact wasting money by NOT taking on some debt in order to build infrastructure or make acquisitions.

As the Economist points out in an article called Debt is Good For You," "dividends are paid out of companies' net-of-tax income,and are then taxed again in the hands of the recipients. Interest payments on debt, on the other hand, are tax-deductible."

"This means that a firm's overall value should increase as it substitutes debt for equity."

--
\

Re:Bad - Enterpise Value by Eslyjah · 2004-02-18 07:55 · Score: 1

No. The value of a company is the amount that it would cost you to buy up all the shares. That's it. The debt and cash on hand are already built into that price.

You are correct that paying off the debt doesn't really affect value, though.

Fantastic! by Karl+Cocknozzle · 2004-02-18 07:55 · Score: 2, Funny

Apple Now Debt Free, Says Internal Memo

How about lets celebrate with Dual-G5s all around?

--
Who did what now?

huh? by Anonymous Coward · 2004-02-18 07:56 · Score: 1, Funny

but i thought apple was dying?

-1 troll

Re:huh? by tinkertank · 2004-02-18 08:02 · Score: 1

that's how the richies trick you into thinking that their hard-up too..... i don't see jobs driving a chevette...

--
___Abuse of power comes as no surprise___
Re:huh? by Anonymous Coward · 2004-02-18 08:11 · Score: 0

Why bother when the rabid mac zelots will mod you down anyway?
Re:huh? by zpok · 2004-02-18 09:13 · Score: 1

Why bother when the rabid mac zelots will mod you down anyway?

Damn! I'm clean out of mod points...

--
I think, therefore I am...I think.
Re:huh? by spood · 2004-02-18 10:06 · Score: 1

but i thought apple was dying?

They're just trying to make sure their relatives don't have anything to pay off after they're gone.

--
---- Just another spud server.

It was me by billstr78 · 2004-02-18 07:58 · Score: 5, Funny

I bought an iBook on Friday for around $1300 without tax. That must have been the sale that pushed them over the edge.

and i still can't afford a G5 by tinkertank · 2004-02-18 07:59 · Score: 1

maybe they could lower the price of their hardware now!?!?!?!?

--
___Abuse of power comes as no surprise___

Already happend. by Bill,+Shooter+of+Bul · 2004-02-18 08:00 · Score: 1

Ms Sold their shares a while back. Hasn't helped market share.

--
Well.. maybe. Or Maybe not. But Definitely not sort of.

Re:want confirmation? - SEC filling just happened by stilwebm · 2004-02-18 08:00 · Score: 4, Informative

Actually the filings are quarterly and Apple has scheduled their next filing for April 14. However, that is for SEC 10-Q statements. Major debt stucture changes could warrant a non-scheduled 8-K filing.

Apple merges with Pixar by wheatking · 2004-02-18 08:09 · Score: 2, Interesting

maybe cleaing up balance sheets and business entanglements to merge Pixar and Apple?

Oh Boy.. Bad IDEA. by demonic-halo · 2004-02-18 08:09 · Score: 2, Insightful

If interest rates now are as low as ever,

It should have just refinanced it debt at the lower interest rates then just used all it's free cash to expand operations, and also invest in some solid dividend paying stocks to provide a scource of income incase things don't work out.

By paying off the debt, it has reduced the amount of free cash, and when it need to take out lone to expand operations in the future, it will be at a much higher interest rate.

Re:Solvent debt free by Anonymous Coward · 2004-02-18 08:09 · Score: 0

The debt is from 1997, 6.5% interest. Apple has money to spare. If it's held as short term securities (high quality bonds, etc), they might get 2-3% interest on their money. Meanwhile, they pay 6.75% on their debt. Paying it off is a good move.

Apple has had several billions in cash for years by chriss · 2004-02-18 08:11 · Score: 5, Informative

Maybe you remember the MacExpo keynote from 1997, where Steve Jobs announced that a) Microsoft had aquired shares of Apple worth $US 150 million and b) guaranteed that they would continue to offer MS Office for MacOS for at least another five years. Today this is still recalled by a lot of PC fans as the day Microsoft saved Apple by buying stock. But what most people did not see was that at that time Apple already had several billions in reserve (I think it were four) and the stock Microsoft bought was basically symbolic, the major news was the Office deal. (http://antibogon.org/Stepwise/TheHolyGrail.html mentiones that Apple was worth $US 7 billion at that time.)

So if Apple now claims to be debt free this does not mean at all that they finally earned enought to pay back their debt. They could have done that years ago. It just means that they decided (for some strange fiscal reasons) to pay back everything in 2004 (remember, debt is positive from a tax point of view) and that, as usual, Steve Jobs takes this non-news and transforms it into holy water for the mac users.

Posted from my blessed iBook

--
memomo: free web based language trainer DE-EN-ES-FR-IT

Re:is that a good thing? NO! and YES! by gosand · 2004-02-18 08:17 · Score: 2, Interesting

With interest rates as low as they are right now, shouldn't they be borrowing and investing more in the future, or some such economic technobabble like that? Cash in the bank can't be giving them as much growth as investment would...

Well, what are you referring to? Is it good that they are out of debt? Yes. Is having no debt necessarily good for a company? No. Can Apple now borrow a ton of money and go back into debt? Yes.

What we didn't see was the second memo that went around saying "So now we can borrow our asses off!" :-)

All this is saying is that they are out of debt. If they are like most people, the second they get out of debt, they usually go right back into it somehow. Maybe they paid off their higher interest debt, and will be able to get a big chunk of R&D money at lower rates. Hell, maybe this was just a PR thing to get them in the news. Seems to have worked...

--

My beliefs do not require that you agree with them.

Riiiggghhhttt... by bl8n8r · 2004-02-18 08:21 · Score: 1

I'm to understand Apple bought back their sou... er.. paid off this $150 million as well? http://www.wired.com/news/print/0,1294,5814,00.htm l Does this mean they are no longer AppleSoft?

--
boycott slashdot February 10th - 17th check out: altSlashdot.org

Not relative to GDP. by iceperson · 2004-02-18 08:22 · Score: 2

To use numbers without regard to inflation or their relation to GDP makes no sense. But then again the adjusted numbers don't validate your percieved "reality" so you choose to ignore them.

Thanks to Spam, to boot! by Anonymous Coward · 2004-02-18 08:22 · Score: 4, Funny

All it took was for Jobs to respond to an email informing him that m0rttgage rattes are at an ALLL T1ME L0W, refnance now!

fdsaf fdfg4r
uttmfgs bnswf mmsgv orange micron
"And what would you havve me do?" Said Emma. The Rain in Spain falls mainly in the plain.

Click here to unsubscrbe.

Isn't it... by jdtanner · 2004-02-18 08:23 · Score: 1

...amazing how much profit you can make on the sale of an iPod mini ;-)

John

How much?? by iceperson · 2004-02-18 08:27 · Score: 1

How much of the national debt was accumulated during Democrat controlled congresses and the interest on said debt? Let us all know when you come up with that number. I have a feeling I won't be hearing back from you in a long long time.

Re:How much?? by prockcore · 2004-02-18 08:40 · Score: 1

How much of the national debt was accumulated during Democrat controlled congresses and the interest on said debt? Let us all know when you come up with that number. I have a feeling I won't be hearing back from you in a long long time.

$0. We had a surplus when GW took over.
Re:How much?? by cayenne8 · 2004-02-18 09:03 · Score: 1

I don't believe a surplus is good either. It means the govt. has too MUCH of MY money....
I'm looking for a balance.....or slight debt...

--
Light travels faster than sound. This is why some people appear bright until you hear them speak.........
Re:How much?? by MoneyT · 2004-02-18 09:04 · Score: 1

Just a note, a budget surplus is not the same as having 0 national debt. (Remember all the people saying how the surplus should be used to pay down the debt?)

--
T Money
World Domination with a plastic spoon since 1984
Re:How much?? by kannibal_klown · 2004-02-18 09:17 · Score: 1

I believe the "surplus" referenced that the country made more money the previous year than it spent. People WANTED Bush to use some of that money left over from last year, and put it towards our long-term debt.

The US is in MAJOR debt. I mean, Bill Gates's fortune wouldn't even be a drop in the bucket compared to what we owe. I just hope live to a ripe old age before someone decides to collect.

Oh, that's right, this is America by Anonymous Coward · 2004-02-18 08:28 · Score: 0

Go $100 into debt to save maybe $38 on your taxes.

XI. The more you spend, the more you save.

Re:Solvent debt free by nelsonal · 2004-02-18 08:31 · Score: 1

Generally bonds must be purchased on the market at the going price unless there is a term allowing the borrower to repay the bond early (called a call option or callable bond). Since rates have been low and Apple is less risky they they have been in the past, it would have cost them more to repay them prior to their maturity (when they repay at face value).

--
Degaussing scares the bad magnetism out of the monitor and fills it with good karma.

Re:This is silly by catdevnull · 2004-02-18 08:39 · Score: 1

dude...I think Linux fanatics are even worse than Apple fanatics. You yourself poo-poo'd Apple 'zealotry' and went all out geek with a "GOOOOOO LINUXXXX..." tag.

I'm just sayin'...pot. kettle. black.

When linux survives the SCO FUD storm, you'll earn your bragging rights. Right now, you're in the "beleagured" category with Apple. So play nice ;) Any positive news about Apple's finances are good. Any good legal news about SCO v IBM is also good. We all know the deal, but non-techs and corporate brass don't. Spin, dude. Spin.

Remember, as long as M$ doesn't win, the rest of us do.

--

I might know what I'm talkin' about, but then again, this is Slashdot...

I just hacked apple's bank account and... by horcy · 2004-02-18 08:39 · Score: 1

... yes it's true. I saw the 300 mil payment. Good Jobs from Apple =)

--
Check my site: http://pixel.pagina.nl

Re:Sweet god! by Anonymous Coward · 2004-02-18 08:40 · Score: 0

> That's just so not funny. +5? +5???

dollars

I was kidding too :-) by SuperBanana · 2004-02-18 08:42 · Score: 1

I think he was kidding around about it.

So was I :-)

--
Please help metamoderate.

offtopic by Anonymous Coward · 2004-02-18 08:43 · Score: 1, Insightful

"Those who can't do... teach."

Brilliant thinking. If there was no teaching, there'd be a helluva lot less doing.

Apple paid cause the debt was due by RyanP · 2004-02-18 08:44 · Score: 3, Informative

The article said: "But there was still $300 million of remaining debt, which we decided to hold to maturity." Doesn't this mean that they paid off the debt when it came due? I know there's tax advantages, but the debt was due, the way I read it...

-Ryan

clueless street by skia · 2004-02-18 08:46 · Score: 1

And on the news Apple's stock does...
Nothing!

--

Re:This is silly by Mr.+Darl+McBride · 2004-02-18 08:48 · Score: 1

Amazon's had profitable quarters, but a profitable quarter is not the same thing has having no debt.

This is just like Bush going on a deficit spending binge, and then claiming it's no problem because we can eliminate the deficit within 8 years. Yeah. After you DOUBLED the national debt, Bush!

Not just "borrow and spend" ... by finelinebob · 2004-02-18 08:49 · Score: 1

Try "tax-cut and spend"

Re:want confirmation? - SEC filling just happened by delphi125 · 2004-02-18 09:03 · Score: 2, Informative

Trimesterly means every three months.

Quarterly means four times a year.

Your confusion probably arises from the fact that there are only three school terms, the word 'term' being an anglification of 'tri-mester'. To compound that, the prefix 'se-' before 'mester' in those schools which work with two longer terms (sems?) could easily be confused with 'semi'.

No assumption made, pal... by TopShelf · 2004-02-18 09:05 · Score: 1

At least if you tax X and spend X+Y, you end up with less debt than if you give away X, and spend X+Y on top!

--
Stop by my site where I write about ERP systems & more

Re:want confirmation? - SEC filling just happened by MrDingusMcGee · 2004-02-18 09:10 · Score: 1

Trimesterly means every three months.

Trimesterly means...nothing in fact.
Trimestral or Trimestrial means a period of 3 months.

I realize this is a fickle point, but one that should be mentioned in the context of proper usage of words, nonetheless. Regardless, parent makes a good point that, if I had to guess (and i don't), most people are entirely unaware of.

--
My Sig is Sauer.

Attractive takeover target? by OgGreeb · 2004-02-18 09:11 · Score: 3, Interesting

According to money.cnn.com, Apple's market cap is about $8.6 billion. With (now) no debt, $4.8 billion in the bank and a relatively thriving and growing niche (plus the music distribution), doesn't this make them an even more attractive takeover target, with their bank account paying for much of the cost of acquisition?

--
-- Gary Goldberg KA3ZYW 301/249-6501 AIM:OgGreeb Digital Marketing Inc., Bowie, MD //www.digimark.net/

Re:This is a bad thing/stock dividends by adzoox · 2004-02-18 09:12 · Score: 1

A company that isn't in debt can also have a dividend - something Apple suspended way back when - Apple used to have a divendend like Coca Cola stock does.

--
Yell & scream & rant & rave... it's no use... you need a shaaaave ~ Bugs Bunny

Re:Bad - Enterpise Value by MerlynEmrys67 · 2004-02-18 09:14 · Score: 1

You missed the point.

I buy all the shares of Microsoft spending 288 Billion in the process (Ok - I would assume I'd have to pay a premium over this value - but for the sake of arguement lets make it an even 300 B)

When I am done - what do I have, all of Microsoft - plus a little over 50 Billion in cash that I can use to blow in a party - so I spent 300 Billion - but got 50 Billion back in change - Enterprise Value - 250 Billion

Now lets go buy GM 27 B Market cap (lets call it 30 Billion) but what do I get back 271 Billion in Debt that I will have to finance making the aquisition cost me 300 B.

Yes all of this is factored into the price of the stock - but when you deal with large numbers like this enterprise value does matter. This is the difference between market cap (what it would take to buy all the shares) and enterprise value (what it is really worth - due to balance sheet items)

--
I have mod points and I am not afraid to use them

Wrong! It was $5.7 trillion in 2000. by iceperson · 2004-02-18 09:19 · Score: 1

National Debt and Budget deficits aren't the same thing. In 1994 the national debt was $4,692,749,910,013.32. In 1950 the Debt was down to zero. How many years did the Republicans control congress from 1954 to 1994? Let me answer that for you. Zero!

WHQL by chiph · 2004-02-18 09:20 · Score: 1

The x86 world is so heterogeneous that if an OSX for x86 was released, it would have so many compatibility problems that Windows XP would look elegant by comparison.

In theory, if you only buy hardware that is on the WHDC list, you shouldn't have any compatability problems. Is that $12 IDE controller card that's on sale this week on the list? Probably not!

I admit, though, the Apple total enviromental control method is more robust. I saw the same thing in the AS/400 world -- IBM supplied the hardware & software, plus the development tools. The machine just never crashed, even with a dozen developers pounding on it!

Chip H.

4.8billion for like ages..... hope not in USA bank by cheekyboy · 2004-02-18 09:21 · Score: 1

They have had 4.x billion in the bank for ages, if its an usa bank giving you 1.25% they are getting ripped off.

if they transfered 70% of their 4.8billion into EURO bank 1 year ago, it would have grown to 6billion usa$ today with currency changes and higher interest payments.

They got shafted, or too stupid to realise it, even Buffet is moving cash into EUROs coz the USA$ is dead... its a lame duck, with so much bonds being offered and so much debt in usa, the usa $ is in 'too much supply' its price is going to fall, fall big time.

Welcome Argentina MKII.

www.financialsense.com for your enlightenment.

--
Liberty freedom are no1, not dicks in suits.

Debt is relative by iceperson · 2004-02-18 09:22 · Score: 1

The number is big and it should be an issue but when compared to GDP the deficit isn't nearly as bad as people here are trying to make it out to be.

Re:Debt is relative by Anonymous Coward · 2004-02-18 12:39 · Score: 0

The interest on the debt is is a third of the total budget. Fuck the GDP, that shit is out of control.
Re:Debt is relative by iceperson · 2004-02-19 04:11 · Score: 1

I agree, but to blame any one person or party for the entire national debt is just plain wrong. If you consider how much the Dem candidates want to spend if elected the deficits will keep on coming.
Re:Debt is relative by kannibal_klown · 2004-02-23 04:45 · Score: 1

I agree that you can't blame this on 1 person. The national debt was huge before Bush, and it will be huge for decades to come.

It wasn't the single button... by Sycraft-fu · 2004-02-18 09:28 · Score: 1

so much as it was the not-made-for-the-human-hand shape. My hand is longer than it is wide, about twice as long actually. The hands of other people I've met seem to be similar. Thus it makes sense to have a mouse that is of a similar shape. A round mouse is not easy to hold or use.

I have no beef with the one button, I've known more than one user that two buttons was beyond their mental capacity, never mind a scrolly, but the shape was a problem. Hence the new optical cough drop. Much better design.

To Put it More Simply... by Anonymous Coward · 2004-02-18 09:30 · Score: 0

If you finance your company with only debt, the bank OWNS your company.

A good rule of thumb for prospective investors is that the value of debt should be less than the value of equity.

At least then the bank owns less than 50%!

Re:To Put it More Simply... by ArekRashan · 2004-02-18 11:55 · Score: 1

Utter bullshit is a little strong. While your creditors don't get to make managerial decisions, they do "own" part of your business in the very real sense that they own a portion of your assets exactly equal to the amount they are owed. Creditor is a synonym for owner, just as debtor means "ower". So while the bank shouldn't be said to own your business (unless they have capital), they may very well own your inventory, equipment, cash, accounts receivable, etc. Not usually a good place to be. Actually, there is at least one general rule of thumb I find very useful in any circumstance: Pay Attention. There may be more, YMMV.

Late Victorian Holocausts by meehawl · 2004-02-18 09:31 · Score: 0, Troll

The British colonial empire was certainly not a good thing, but it did little permanent damage, at least in India.

Oh yeah? During the later part of the 19th Century the British system of Empire created sociopolitical famines in South America, India, and China that eclipsed any of the death toll numbers of their 20th Century wannabe imitators, such as the Nazis:

Responding to famines in pre-British India, its Moghul rulers embargoed food exports, regulated prices, distributed food for free, and relaxed tax collection. Similarly in the 17th and 18th centuries, the Chinese state managed effective famine relief and flood control systems. But the British state's occupation of India and its Opium and Arrow wars against China destroyed all these systems ... From 1757 to 1947, India's per capita income failed to improve. In the last half of the 19th century, India's income fell by 50%; life expectancy fell by 20% between 1872 and 1921; the population hardly grew. There were 17 serious famines in the 2000 years before British rule, but 31 in the 120 years of British rule. Empire, not Asia's 'immemorial' traditions, or overpopulation, kept India poor ... In times of drought, Britain actually _increased_ taxation and food exports from famine stricken India. He then proves that British imperialists were well aware of the famine, and allowed the policies to continue. Worse still, they offered food relief only in exchange for hard labor, at a caloric ratio slightly worse than that of the Nazi death camp at Buchenwald. By British estimates roughly 20 million Indians died, while their colonial masters spouted racist mantras.

--

Da Blog

Paying off debt can mean lack of expansion. by demonic-halo · 2004-02-18 09:32 · Score: 1

Agreed,

Sometimes, in a low interest rate environment like today, a company not taking on any new debt can be viewed as not being able to identify new opportunities.

Paying off debt is something a lot of mature companies do. For example, large tobacco companies are having a harder time expanding, so they focus all their cash flows into paying dividends and paying off debt.

your sig by Anonymous Coward · 2004-02-18 09:35 · Score: 0

to lose
too loose

Prodigies by meehawl · 2004-02-18 09:41 · Score: 0, Troll

The British were rich long before colonialism.

That's true, but when you say "rich", you should qualify it to say that British society was characterised by a well-developed, rigid social stratification based on the enslavement and dispossession of the Irish and Scots and their conversion into captive rentiers.

The tactics that worked so well on the Irish and Scots (Plantation, Genocide, Ecological Terraforming) were later expanded by the London capital companies into larger-scale developments in North America and, later, Australia and New Zealand, to create the "neo Europes".

So yes, you're right, they were "rich" before Colonialism emerged as a coherent ideology in the 19th Century.

Most Empires have begun with smaller scale beta projects close to home. Before the Spanish began on their conquest of Central and South America, they spent the best part of a century conquering, then exterminating the indigineous inhabitants of the Canary Islands. Once purged of natives, the Islands were converted into vast monoculture sugar plantations. This strategy was later replicated throughout SPanish (and Portugeuse) dominions.

--

Da Blog

Don't forget Next by demonic-halo · 2004-02-18 09:43 · Score: 1

Under assets, there should be some component called "Goodwill" for acquiring Next, which apple will use to write depreciation expenses from their taxes.

Yes, this is a good thing by bitty · 2004-02-18 09:47 · Score: 0, Redundant

You want to be debt free, plain and simple. You have no interest payments. Why the hell would you want to pay interest payments for no reason at all? If you've got the cash, pay it off. It only gets better from there.

If this is true, congratulations Apple!

Re:Bad - Enterpise Value - Looking at GM by MerlynEmrys67 · 2004-02-18 09:47 · Score: 1

Ok - before I get flamed for not looking at the balance sheet of GM closely enough. While there is 271B in Debt - there is also 41B in cash and 21B in short term investments. I would also like to note the 166B in long term investments (debt owed to GMAC probably - remember all of those 0 percent loans ???) - so the enterprise value of GM isn't quite as high as reported above probably closer to 140-150B.

That said - this is why evaluating balance sheets are quite difficult, especially for companies with strange debt (see Enron - by hiding their debt - they looked a lot stronger than they really were, remember if you don't see the debt - your enterprise value goes down)

--
I have mod points and I am not afraid to use them

Re:4.8billion for like ages..... hope not in USA b by Anonymous Coward · 2004-02-18 09:50 · Score: 0

You really need to read up on how corporations do short term investing, hint: it isn't in currencies.

easily solved... support 'best hardware only' by cheekyboy · 2004-02-18 09:51 · Score: 1

Just support only 2 video cards, nvidia/ati
And build your own x86 hardware using nvidia chipsets or via or sis.

OR just run ONTOP of the win2000/XP infrastructure, ie just replace the SHELL and top system.

--
Liberty freedom are no1, not dicks in suits.

Re:easily solved... support 'best hardware only' by GlassHeart · 2004-02-18 10:42 · Score: 1

OR just run ONTOP of the win2000/XP infrastructure, ie just replace the SHELL and top system.
This means Apple has to pay Microsoft for every copy of x86 OS X sold. What makes you think this is a good idea?

Time to buy Apple? by zenslug · 2004-02-18 09:51 · Score: 1

If dropping their debt is not getting them anything except PR, and many here have already said that debt is a good thing to manipulate earnings, then for me it stands that Apple is ready to show that they are clearly making a proft.

Apple can't as easily hide the truth behind profits/losses when they have no debt, so it seems to me that they will be showing some clear gains soon. Just a guess...

don't let it stop you by univgeek · 2004-02-18 09:58 · Score: 1

Install sidetrack - www.ragingmenace.com

and set up a scroll bar (both horizontal and vertical), tap on the trackpad for left click, and tap on the button for right click.

Yeah, there is no middle button, so cut and paste on X11 is still out. But I find this to be extremely comfortable.

--
All bow to his Noodliness!! His Noodle Appendage has touched me!

Re:don't let it stop you by Seanasy · 2004-02-18 16:11 · Score: 1

Yeah, there is no middle button, so cut and paste on X11 is still out.
Option+click pastes in X11 on OS X.

Get out of Debt! by ObiWonKanblomi · 2004-02-18 09:59 · Score: 1, Funny

I wonder if Apple actually replied to one of those "Get out of Debt!" spams.

All fine till someone defaults. by Moderation+abuser · 2004-02-18 10:01 · Score: 1

I love all this profit through debt stuff. It's great till someone says "Eh yeah, sorry, it didn't work", or in the case of a number of 3rd world countries "Haha, fuck you, we're not paying you back". Debt is risk.

--
Government of the people, by corporate executives, for corporate profits.

And $300 million is missing from my PayPal acct.! by turnstyle · 2004-02-18 10:07 · Score: 2, Funny

"Apple used $300 million in cash to pay off the rest of their debt, and is now a debt-free company."

And I just noticed that $300 million is missing from my PayPal acctount! The bastards.

--
Here's what I do: Bitty Browser & Andromeda

by coincidence ... by timothy · 2004-02-18 10:11 · Score: 1

Since I am usually having more than one argument at a time ;), I happened to have just been looking at this Reason mag article tangentially tied to this thread, quoting J.K. Galbraith (not to be confused with J.K. Rowling) as follows:

"High technology and heavy capital use cannot be subordinate to the ebb and flow of market demand. They require planning and it is the essence of planning that public behavior be made predictable--that is be subject to control."

"At this point, prices for products or services are higher than they would be in a perfectly competitive economy; fewer goods are being produced; and the monopolistic firm is enjoying above normal profits."

I'm unconvinced by the sentence beginning "It has been determined by economists that a monopoly will create a situation ...", as I am (and this is the idea that the blockquote above depends on) that there is any such thing as a "perfectly competitive economy" outside an economics classroom, *unless* the factors of real life are allowed for and "perfect competition" is considered only in terms of barriers to entry. (A good flea market may represent a perfectly competitive microcosm, but not everyone will have thought or had opportunity to actually bring the same goods ...)

timothy

--
jrnl: http://tinyurl.com/c2l8yr / foes: http://tinyurl.com/ckjno5

Macslash? by Millennium · 2004-02-18 10:11 · Score: 1

You wouldn't mean MacSlash.org, would you?

fair enough... by pb · 2004-02-18 10:24 · Score: 1

I'm not convinced that small particles are spherical, but assuming that they are can certainly make your mathematical modeling simpler. There may in fact be no true perfectly competitive economies, but that doesn't make it a worthwhile goal, and it doesn't stop you from seeing when your economy isn't perfectly competitive--in fact, it can help.

Similarly, even though (or perhaps because) no country has a truly equitable distribution of wealth, its gini index is still a useful tool, and it still makes sense to strive to lower that number towards fairness (or raise it, as the case may be, if you're already Bill Gates).

--
pb Reply or e-mail; don't vaguely moderate.

Re:fair enough... by timothy · 2004-02-18 10:55 · Score: 1

Similarly, even though (or perhaps because) no country has a truly equitable distribution of wealth, its gini index is still a useful tool, and it still makes sense to strive to lower that number towards fairness

I doubt that there's any universally (or even practically univerally) accepted definition of "truly equitable distribution of wealth", but thanks for pointing out Gini indexes, I'd never heard of these before.

If I'd covered up the numbers first, this would have made a fun guessing game, even with "greater or less than the U.S.' number.":

http://www.undp.org/hdr2003/indicator/indic_126_ 1_ 1.html

timothy

--
jrnl: http://tinyurl.com/c2l8yr / foes: http://tinyurl.com/ckjno5
Re:fair enough... by pb · 2004-02-18 11:19 · Score: 1

It always entertains(/depresses) me that the US is about on par with China on this one...

--
pb Reply or e-mail; don't vaguely moderate.

Re:Apple has had several billions in cash for year by Anonymous Coward · 2004-02-18 10:24 · Score: 0

You might get taxbreaks for debt; but you're still paying interest on it too. Not being in debt is always better than being in debt.

To Put it More Simply... by Anonymous Coward · 2004-02-18 10:33 · Score: 0

Utter bullshit.

If you own >50% of the equity you make the decisions. The debt holders have a senior claim if it all goes wrong, but don't dictate how to run the company, though they can ask for the money back (in a nice or not so nice way). If you don't borrow but issue equity so you are in the majority you are no longer in control. Debt holders are not owners.

A good rule of thumb is there is no general rule of thumb.

Re:want confirmation? - SEC filling just happened by rootofevil · 2004-02-18 10:36 · Score: 1

and people think programming nerds are scary - im more afraid of finance nerds

--
turn up the jukebox and tell me a lie

nothing new here by Anonymous Coward · 2004-02-18 10:39 · Score: 0

Fred announced during the most recent conference call with analysts that Apple planned to retire this debt. No news here.

Re:Bad - Enterpise Value by Anonymous Coward · 2004-02-18 10:39 · Score: 0

Yes, this is quite obvious (Though perhaps not to people who don't have any background in finance and think "debt it bad" because of their personal credit card experiences, or whatever).

Apple (financially speaking) has been a lucrative takeover target long before this, when it had comparatively little debt and comparatively large cash reserves. The point is, if anyone attempts to buy out Apple, they've either gotta be crazy, or REALLY know what the hell they're doing. Apple has a unique, distinctive, and strong culture. To buy it, especially if the Steve-O wasn't playing ball, would be suicide: Apple's strength lies in its exceptionally talented team of employees, and no company would get far if they pissed 'em off. This is precisely why not company's going to make a bid for it (Unless they're in one, or both, of the categories described above).

Of course, one could argue that the a similar line of logic meant that Comcast WOULDN'T try to buy Disney....and I guess that shows that I'm an idiot, or something. Oh well :)

Well, Apple said this would happen by sribe · 2004-02-18 10:40 · Score: 4, Informative

Since this is not coming straight from Apple, confirmation -- or debunking -- would be helpful.

Well, given that at the announcement of their last quarterly results they stated that they would likely pay off their debt this quarter, it seems likely that this is true.

Apple free of debt by Anonymous Coward · 2004-02-18 10:43 · Score: 0

Oracle had the same thing in 1991 and they paid off the loan in 1995. Until the debt was paid off, there wasn't much expansion into development and new products going on. After the debt was paid off there was more freedom to develop new products and expand the campus. Now you should really good stuff from Apple... I hope.

Re:want confirmation? - SEC filling just happened by delphi125 · 2004-02-18 10:56 · Score: 1

Google makes this interesting!

Although trimesterly comes up only a few hundred times, it is used - and I would be willing to bet that people that know the word trimester would use this form in speech be analogy with hourly, daily, weekly, monthly, yearly. Having said that, they would use quarterly instead, if they cared about meaning, as I do. Trimesterly cannot mean anything else, semantically, but it is obviously confusing.

Trimestr(i)al is no less confusing. My thanks for pointing out the correct form(s) by the way - I posted to inform and I was rewarded by being informed back. As ye sow, so shall ye reap. But using google on the form without the 'i' gives Spanish results, and although the more usual spelling with 'i' gives English results, the first question it asks is if you are looking for 'trimestriel' which in turn gives French pages.

This goes back to the origins of the English language in both Latin and Germanic roots. Quarter comes from German, where perhaps the four seasons were more important when the language was being formed than the division of time by the Romans, be it for years or childbirth (three trimesters).

In conclusion I would argue that Trimesterly DOES mean something. I'm interested in the semantics, the meaning, and not the syntax or the grammar so much as communicating. The semantically very similar 'word' quaternionlike can be found just once on Google! Of course, since it should be hyphenated (and there are only a few results there too) this isn't a perfect example, but we know what it 'means'.

Their last filing by minkeyboodle · 2004-02-18 10:56 · Score: 3, Informative

Their last filing show on their balance sheet showed that they had just over $300 million in long/short term debt. So if they did pay it, then that means they have no "debt." They still have lots of liability, though.

Time to buy by Anonymous Coward · 2004-02-18 10:58 · Score: 0

1)
Alias

2)
Discreet

3)
SGI

In that order.

Once again people by Anonymous Coward · 2004-02-18 11:01 · Score: 0

If you love your karma, don't dare post an objective post in a mac thread. Make sure to check that little box "Post Anymously"

You knew this was coming... by Anonymous Coward · 2004-02-18 11:05 · Score: 0

Step 1: Pay off debt
Step 2: ???
Step 3: Profit!

That $50 billion was not accumulated in one year.. by Anonymous Coward · 2004-02-18 11:06 · Score: 0

It could be seen as a bit misleading to say you could hire 1 million people for $25/hr for a year. That would not be at all sustainable.

Not only that... by filmsmith · 2004-02-18 11:07 · Score: 1

but I hear the Bush Administration is fast on track to becoming the biggest spender since the beginning of the Twenty-First Century!

Damn, that takes balls.

...or timing.

fs

Since this is not coming straight from Apple... by wfberg · 2004-02-18 11:12 · Score: 2, Insightful

(Since this is not coming straight from Apple, confirmation -- or debunking -- would be helpful.)

How about you call them? They're required, as any public company is, to release information that may affect their stocks' value in a timely manner, especially if it has leaked - to avoid insider trading. That's a very firm legal obligation.

Have any of you ever tried calling their PR/Investor line and saying "Hi, I'm an editor for slashdot.org, we get x amount of hits, and I'm about to publish y bit of information"?

--
SCO employee? Check out the bounty

Re:Solvent debt free by Anonymous Coward · 2004-02-18 11:13 · Score: 0

i really hope you're a little kid or something; otherwise there's no explanation for your comment other than you being a moron.

this isn't your mom and her credit card. this is a corporation with much more complicated finances than you realize.

Objective-C by Kris+Magnusson · 2004-02-18 11:14 · Score: 3, Informative

Came from an author named Brad Cox, in book that's sitting on my floor called Object Oriented Programming: An Evolutionary Approach.

NeXT made a decision that it would be the next big thing due to its dynamic binding qualities, required for the AppKit and other kits, so they licensed it. ........... kris

--
"I thought I could organize freedom. How Scandinavian of me."

Re:Objective-C by Anonymous Coward · 2004-02-18 11:49 · Score: 0

Mod up. He is right, parent is all wrong. And this is info that's easy to corroborate.

HP was without debt (before ...) by plb · 2004-02-18 11:17 · Score: 1

Nor did he and Bill wish to take on any long-term debt.
"Having grown up during the Depression, we were determined to fund growth from profit and
not to operate on borrowed money."
Still another HP policy, faithfully followed right up to the present, is to maintain a relatively
high level of investment in research and product development.
Over the years the company's annual spending on research and development amounted to as much
as ten percent of sales, supporting Packard's contention that "good new products are the
lifeblood of this business."

But I thought Apple was still beleaguered by Infonaut · 2004-02-18 11:17 · Score: 4, Funny

What happened to all the doom and gloom?

Where are the Wired magazine articles about how to "save" Apple?

Where in the hell is Dvorak when you need him?!

--
Read the EFF's Fair Use FAQ

Why does apple keep so much in the bank? by Unregistered · 2004-02-18 11:23 · Score: 2, Interesting

It seems like it would make more sens for apple to put that 4.8 bil to good use instead of sitting on it by trying to expand into new markets, or if SJ doesn't think there are any new markets ready to be moved in to, selling at a loss as to get more customers. Do they keep tose cash reserves because they have been in financial trouble before and want to avoid that ever happening agiain or what? Or is 4.8 bil not nearly as much of a big deal to apple than i thought. Cauase it seems pretty wasteful it it only exists so we can easily respond to apple is dying trolls.

Other countries... by KamuZ · 2004-02-18 11:30 · Score: 1

It would be nice if Apple could make cheaper products for other countries (like Mexico), other companies like Acer make cheap computers because many people downhere can't buy the "regular" computers from first world countries.

Apple computers are great, they use it where i work but they are so expensive!

Don't forget about... by pyrrho · 2004-02-18 11:34 · Score: 1

When steve jobs founded the University of California by passing the Land Grant Act.

And butter, he invented butter.

--

-pyrrho

Hey! by Cnik70 · 2004-02-18 11:48 · Score: 1

The sad news is that the dollars they paid their debt with only appear to work on Apple hardware. Yet the banks admit they are really digging these iTune downloads :)

--
-Cnik

Wasn't he also acting CEO? by 0x0d0a · 2004-02-18 11:56 · Score: 1

Didn't Fred Anderson also become acting CEO of Apple for some time after Gil left?

The name may not be as familiar as past Apple CEOs, but he's certainly been a major player.

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May we never see th

Re:Wasn't he also acting CEO? by good+soldier+svejk · 2004-02-18 12:21 · Score: 2, Informative

Yes, he was acting CEO. He was also the only member of Gil's management team to survive Steve's purge, IIRC.

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It is cowardly, and a betrayal of whatever it means to be a Jew, to act as a white man

-James Baldwin

Supplementary Math Lesson by Christopher+Whitt · 2004-02-18 12:36 · Score: 3, Informative

When calculating interest, you use 1.x where x is the interest rate. 4% = 1.04 > 1 so while not that large, it does not tend toward to zero.

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Mozilla

So why not... by doormat · 2004-02-18 12:41 · Score: 1

Lower the price of iPods???? Really! $300 is a *lot* of money.

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The Doormat

If you're not outraged, then you're not paying attention.

Congress: RIAA to get all statutory royalties by michaelmalak · 2004-02-18 13:22 · Score: 1

Hey, I first heard about it in a slashdot comment. So, as usual, I did some research and made it a story on my blog. It turns out the slashdot comment didn't have it quite right -- it's only for statutory royalties, which are the royalties paid by radio stations, etc. when they play any copyrighted song they want (thereby invoking the mandatory copyright licensing Congress set up long ago for just that purpose).

So if you're an indie, and a radio station plays your song, you are obligated to license the radio station to play that song, and the RIAA gets the royalty.

Worst designed mouse?! by hchaput · 2004-02-18 14:07 · Score: 1

You think that was the worst designed mouse ever? As an avid mac user, I take great offense. Clearly this is the worst design mouse ever. Please.

Please? by 2nd+Post! · 2004-02-18 14:24 · Score: 1

What are you talking about?

A link, a name, a reference would be useful.

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GPL Deconstructed

Re:Please? by MoneyT · 2004-02-18 15:26 · Score: 1

It's called SideTrack

SideTrack is a replacement driver for the trackpad (touchpad) found on Apple PowerBooks and iBooks. It brings many of the advanced trackpad features found on Windows laptops to Mac OS X.

SideTrack supports these features:

Vertical scrolling at left or right edge of pad.
Horizontal scrolling at top or bottom edge of pad.
Map hardware button to left or right click.
Map trackpad taps to no action, left click, left click drag (with or without drag lock), or right click.
Compatible with uControl, including uControl's scroll emulation.

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T Money
World Domination with a plastic spoon since 1984

Re:want confirmation? - SEC filling just happened by Anonymous Coward · 2004-02-18 16:41 · Score: 0

This goes back to the origins of the English language in both Latin and Germanic roots. Quarter comes from German,...

From the German, eh? Nope, and I'm not the only one who thinks otherwise

Thanks for noticing! by Anonymous Coward · 2004-02-18 17:36 · Score: 0

We are doing REALLY great. Why do you think every other nation on earth is selling to us. It's because we have the money. Did you think they could sell to us if we were poor? We're so damn rich we rebuilt the economies of Western Europe, Japan, Taiwan, Korea, and Indonesia and now we're trying to rebuild China and India too. That might be an overreach though, because I'm not sure even WE are that rich. On the other hand once we have China going it might actually have a large enough internal market to bootstrap to success, sadly I'm just not sure the same is true for India. Still, time will tell.

Cheers!

Didn't CMU build Mach? by Anonymous Coward · 2004-02-18 17:48 · Score: 0

I thought NeXT licensed Mach from CMU?

heh... by pb · 2004-02-18 18:06 · Score: 1

What you speak of is more of a community issue than a technical issue; obviously the *BSDs have different distributions too, (which also aren't terribly incompatible) and all of these Unix platforms are capable of using the same free toolkits.

If you set up your organization on Linux, and standardized on a particular distribution, desktop environment, stable set of applications, etc., then you wouldn't have a problem. Or you could indeed pay Apple to do all that for you, much as you could pay any Linux reseller.

As for your first point--and the only one that seems to reference my points--yes, the cost of software is quite flexible due to the enormous mark-ups involved. Other industries (music, movie, and pharmaceutical to name a few) that rely on protecting their IP to protect their profits could have similar properties, although they sometimes won't provide such incentives in favor of maintaining their monopoly control and artificial pricing schemes.

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pb Reply or e-mail; don't vaguely moderate.

English translator. by donsaklad · 2004-02-18 18:10 · Score: 1

a.
Around the web, where is there an automatic translator?... for http://www.99mac.se/

b.
What is the english translation of the text before and after the text by steve jobs?...

Predates but basically separate by ynotds · 2004-02-18 18:15 · Score: 3, Interesting

NeWS is about the only thing that would get me to post this late in the life of a story, and with mod points to burn.

My then company, PICA Pty Ltd, worked with both Sun and Adobe on the respective fronts way back then. Sun encouraged us to devote our own resources to a Macintosh port of NeWS by contracting us to develop NeWS demonstration applications, some of which got a guernsey in Gosling, Rosenthal and Arden's NeWS Book .

We were a recognised early player in the PostScript game because I landed the job of doing a technical review of one of the first two Apple LaserWriters to reach Australia for Australian Macworld. That led to PICA becoming the local distributor for Adobe and other early desktop publishing products, and to me contributing the final chapter to Roth, ed's Real World PostScript .

In what may seem like several cases of deja vu, Michelle Arden was very keen to help us try to convince Adobe to open up control of the PostScript standard, yet within a couple of years Sun, having made themselves quite unpopular through the success of NFS, were then rolled by the rest of the Unix community who insisted on adopting X as the blessed window system ahead of the much superior NeWS.

Despite strong support from our main contact person, the inability to focus by Sun's Sydney office brought our efforts to a premature end, on one hand because they had initially tried to motivate us by suggesting we were in competition in the porting project with Keith Henson's Grasshopper Group. Then when I finally met Keith we became instant friends. Meanwhile Sun Australia also managed to hold up payment for our contracted work for 14 months.

Bottom line is that Sun's efforts with NeWS were in spite of Adobe. The significantly later Display PostScript did not borrow directly from NeWS in any way. If Sun ever gain a clue as to why they are being overrun by history, despite making a technical contribution over the years that has been disproportionate to their financial strength, one thing they could start with even at this late stage would be releasing NeWS to the public domain.

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-- Our systemic servants do not good masters make.

betcha apple ownes logitech shares by aaron_pet · 2004-02-18 18:50 · Score: 1

Oh man... I just figured it out!

Apple charges like $40 for their designer mice, (or basically (I'm guessing) add it to the cost of theier box) now they only cost 50 cents to make because they didn't hire anybody to design them...

steve just said in brilliance:
The mouse will make us money! here, make it this shape, and handed it off the the manufacturing plant who ground out the turd that steve game them and made a mold.

And they decided to continue with one mouse button for a similar reason (getting to that here .. hold on)

They own the 3rd party mice manufacturers! or have a deal with microsoft!

lets see... every stinking mac comes with a worthless mouse that they added a lot of money to the price tag for... and! everyone needs to buy another one because it's useless!

(yes it is useless, I've tried using the mice our college book store for hours, I can't hold paper and work at the same time, or scratch and read, or even scroll the stupid window with one mouse button... (it's jerky to click on the button repeatedly)

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Microsoft R&D Cupertino branch by Anonymous Coward · 2004-02-18 19:50 · Score: 0

Besides, without Apple, how can Microsoft innovate? Apple is Microsoft's R&D department.

who cares? by Anonymous Coward · 2004-02-18 21:40 · Score: 0

Mind you, one may well care that Apple is in good financial condition, and measuring that is complex, but ultimately it comes down the net worth, and projection of future net worth. Given a constant net worth, the consequence of holding debt is not even the cost the of the interest, because the same cash you could use to pay off the debt, you could instead use to earn interest, so really the cost of the debt is (tax issues aside) the interest that must be paid on it, minus the risk-free interest you could earn with the cash (e.g. you could buy 10 year treasuries, paying I think around 4%).

The true meaning here is mainly psychological, and the fact that obviously to pay off debt, and to want to pay off debt, you need to actually have the money to do so, and not need that money for another purpose.

Paying off a debt, no matter how big, is net-worth neutral.

To help ensure modding up, and if you want a better grasp on why this is so, read up on the philosophy behind gnucash, particularly the concept of double entry accounting.

Apple hiring hardware designers by the dozens by Ross+Heinlein · 2004-02-18 23:37 · Score: 3, Interesting

I don't know if the memo is real or not, but I've just been hired by Apple, and they are hiring hardware guys hand over fist. I only wish I could talk about the things being worked on here!

I dunno... by Anonymous Coward · 2004-02-19 01:00 · Score: 0

How about lets celebrate with Dual-G5s all around?

Isn't this what Dubya did with the US budget surplus?
Of course... given the choice between a measly tax check or a G5... maybe you're on to something.

Jobs for president!

Re:want confirmation? - SEC filling just happened by RazzleFrog · 2004-02-19 05:14 · Score: 1

trimester means approximately three months and is actually 3 periods of the moon. Using in the business context when it is never used as such is a mistake. You will never hear a company refer to its first quarter as trimester 1.

Re:4.8billion for like ages..... hope not in USA b by Grand+V'izer · 2004-02-20 12:15 · Score: 1

For the twelve months ending 09/27/03 Apple's operating expenses were $6.2 billion, so their cash reserves represent something like nine months of expenses.

Apple's sales tend to be pretty volatile. In light of that, having large reserves becomes important for several reasons. Wenever Apple has a bad quarter people immediately start predicting The End, but the CEO can just point to the cash reserves and say: we can ride this out for a long time.

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Not all random numbers are created equally.

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