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Amazon Hits $1 Trillion Market Value Milestone (reuters.com)
Amazon.com on Tuesday became the second U.S. company to reach $1 trillion in stock market value, just weeks after Apple hit the same milestone on Aug. 2. Shares in the world's largest online retailer last traded up 1.4 percent at $2,041.68. Its shares hit the $2050.2677 level to give its stock a value of $1 trillion. From a report: Amazon and Apple, which hit the trillion-dollar milestone on Aug. 2, symbolize the growing influence of tech companies on markets and the economy. The industry is amassing wealth and power, creating a new order in business where the most valuable resource is no longer oil, but data. Not far behind in market value are Google owner Alphabet Inc. and Microsoft Corp. , both approaching $900 billion, while Facebook -- which crossed $500 billion in July 2017, a day after Amazon -- has stalled at those levels amid a data-privacy scandal and growth concerns.
Enough said.
Captcha: preempt
bah, nothing to worry about until they buy Taco Bell.
the preceding comment is my own and in no way reflects the opinion of the Joint Chiefs of Staff
Amazon is working hard to be a monopoly.
No. I buy nothing from Amazon. Whether they are worth a trillion dollars or they go out of business tomorrow, it is meaningless to me.
When they drive the last of their competitors out of business, will it still be meaningless to you?
I find it amusing that with both companies being at a one trillion market cap, AAPL has a P/E ratio of 20, while AMZN has nearly an order of magnitude higher P/E at 185.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
This needed to be split a long while back. $2K per share keeps out a lot of small investors. It's hard to buy a 100 share block at this price.
Amazon sucessfully tests its first Hydrogen Bomb and builds an ICBM to launch it at Apple.
Data may in fact be more valuable than oil, but neither Apple nor Amazon demonstrate that idea. Apple claims it's not selling it's data at all (and it's investor reports seem to bear that out) and Amazon's growth is largely a matter of market position, not data.
If capitalism is so great, why does it allow monopolies to exist?
Capitalism doesn't really "allow" or "not allow" things. That would be a regulatory scheme.
Capitalism (or more specifically, free markets) is a system that is efficient on the micro-level (for a certain definition of "efficient".) If the system evolves into a monopoly, however, the free market assumptions no longer hold, and the system is no longer efficient.
It seems to me that monopolies are the result of executing your capitalistic business plan successfully. In the physics world, monopolies would represent a low entropy state.
I don't even know what that means. In general, monopolies are a result of entry barriers and economy of scale (which may often be the same: the entry barrier is often because of the economies of scale.)
Once a large corporation enter the scene, there is also an anticompetitive entry barrier: a larger corporation can simply underprice an upstart competitor, using the strategy that they can simply take a loss until their competition goes bankrupt, and once the competitors are all driven out of business, raise their prices to recoup their losses. Is this "executing a capitalistic business plan successfully"? Well, I suppose.
It's Union City and the Hobart Corporation all over again.
"Power tends to corrupt; absolute power corrupts absolutely." Used to be IBM, then Microsoft, now the new kids in town.
The topic says it all.. 2018 dollars are less than half of what 2010 dollars were worth.
But most people already buy most things from Amazon, so where is the growth coming from? Amazon I would argue has some room for growth but it seems like it is near saturation in terms of product sales and is desperately seeking out new markets (hence the push for things like Prime Video). Several websites already have figured out ways to pull me away from Amazon for purchases, why will that not become increasingly common?
Apple meanwhile has more room for growth via several product lines that already exist and have gotten great traction (like the watch), in addition to new markets they have not yet entered but obviously plan to (automotive, and augmented reality spring to mind).
Apple is also growing services revenue substantially which is the thing that really kicked off Amazon's hug stock growth.
"There is more worth loving than we have strength to love." - Brian Jay Stanley
That practice makes the company more valuable than it really is.
This indicates the effect of inflation, more than anything else.
I am not surprised by their market share. It is so damn convenient to shop with them.
In the last 8 months, I have made a concerted effort to avoid buying anything physical from Amazon.
I do use Amazon to search for different products of interest and to get an idea of the price.
I then try to find it in a local store and if the price is reasonably close, I buy it local.
I had a look around last year and noticed that a lot of stores seem to close and suddenly realized that I am part of the problem. So, I buy local when I can, even when it is less convenient. I also remind other others to try and buy local to save money from themselves down the line. After all, when people don't work... someone needs to pay the benefits.
You know what happened after the Roaring 20s, in 1929?
Debate is a form of harassment. Do not question my truth.
Can you spare a couric, asks Bezos.
The value of money is going down, that is why the numbers have increased and every time your money inflates it goes into the pocket of the bank owners. Stealing without reaching into your pocket.
Apple pays half in taxes and Amazon pays half in taxes equals $1 Trillion Dollars and the rest of us don't pay taxes. Problem solved!
Capitalism (or more specifically, free markets) is a system that is efficient on the micro-level (for a certain definition of "efficient".) If the system evolves into a monopoly, however, the free market assumptions no longer hold, and the system is no longer efficient.
I don't think it can even be considered "efficient" when all of its assumptions hold. For example, in an "efficient" market for widget X with 100 suppliers, there is still the waste of creating 100 manufacturing infrastructures for each of the different suppliers. If every supplier has perfect information, then the super-rational solution is to have the lowest cost supplier create all the widgets, sell them at the market price, then share the profits with all the other suppliers.
What I said was that the free market system was efficient on the micro level and qualified that with "(for a certain definition of "efficient")". The certain definition of efficient here is Pareto efficiency. In your simplified case of perfect information, in a free market when there is a trade such that both partners would benefit, that trade will happen, leading to a Pareto efficiency. That is a micro level efficiency-- what you are talking about is a global efficiency-- each individual manufacturer is efficient, but the global system would be more efficient if there were only one.
This is absurd of course. Nobody has perfect information and nobody would distribute their profits, but it does illustrate the limits of the model.
I said a micro level efficiency-- what you are talking about here is a global efficiency-- each individual manufacturer is efficient, but the global system would be more efficient if there were only one.
It is important to note, though, that a free market is not Pareto efficient even on the micro level in the case of monopolies (nor with increasing returns to scale, although increasing returns to scale tends to lead to monopoly, so these are not completely different).
This also shows how Socialism can become more efficient than Capitalism in some cases. The government can become the lowest cost supplier, set the price it thinks should be the market price, then divide profits amongst everyone. This saves on capital, because production infrastructure is built once rather than 100 times.
In practice this does not work for similar reasons to the reason that monopolies are not Pareto efficient. As a monopoly, the government has no incentive to be efficient in any way; in fact, without competition, they have reasons to be inefficient (in the economic sense of inefficient). For example, they would rather use more labor to produce a good than less, since that employs more people (and since they're a monopoly, they can raise the price and still sell product).
The other problem here is the question: who decides? What mechanism urges the people who decide to make the right decisions?
Doing this properly is extremely hard of course, which is why we don't see many successful Socialist countries.
Not merely hard, but arguably impossible. A top-down decision structure in a system with no competition has no driver toward efficiency at all, not to mention no driver toward innovation. In fact, it does not even have a good mechanism for noticing that it is inefficient.