It might be a coincidence but HP's stock started its decline when Hurd was replaced and hasn't recovered since. I wonder if the board regrets how it handled that situation.
I think the patents are a ruse. Motorola could have (and probably would have) teamed up with other Android makers to protect Android, anyway. Google could have enticed Motorola to do so for less than $12.5 billion. I also think Google is in it for the handset business and intends to adopt Apple's business model in the mobile area and go head to head with them. With this purchase, Google has become the 2nd largest handset maker by market cap and has deep enough pockets and mobile software know-how to make a dent in Apple's mobile dominance. Consider that Apple has a market cap of $380 billion and derives over half its revenue from selling iphones and ipads. If Google could only steal 1/10 of that market, this purchase would have been worth it. I think this acquisition is brilliant. Google is going to advertise these phones very strongly and I expect them to reap a large profit from the handset business.
You say that bond holders never had anything to worry about because you claim we would have been able to make payments on the interest. I don't agree with that but even if those claims were true, S&P explicitly stated that they would downgrade us to "D" or "Technical Default" had that happened, which I hope you agree would have been a horrible outcome, so I don't think it's terribly relevant whether we would have been able to continue paying interest or not. Furthermore, AAA is a "risk-free" rating and demanded by investors who can tolerate almost zero risk. Even if you have a 99% confidence interval that we would have been able to continue making payments (which I'm pretty sure you don't), a 1% risk of not getting paid is far too high for someone demanding AAA safety.
"Pay for money" is less ridiculous than it sounds. What are you paying for when you borrow money and are making interest payments? You're paying for the money you borrowed.
Of course there are devices that magically allow people to write IOUs. They're called credit cards. I agree that putting yourself in a position where you would need the IOU is irresponsible. We should not have ordered the appetizer but that ship has sailed. Again, if you think it's irresponsible to use *additional* IOUs, fine, by all means let's have that debate. But to say I won't allow the appetizer bill on the credit card unless I get my way on the main course is unacceptable under any condition.
I don't think Democrats are blameless. Cuts to social security and medicare simply must be made but to threaten bond holders by tying the debt ceiling to the budget negotiations was not responsible towards our lenders because they are an innocent third party and I was shocked that the Republicans were so willing to risk the full faith & credit of the U.S. in order to get their way on the budget. The S&P report specifically cited "prolonged controversy over raising the statutory debt ceiling" as well as "political risk" as one of the reasons for the downgrade. Note that France and the UK, which arguably have worse balance sheets than us (they're holding Greek, Portuguese and Italian bonds) retained their AAA and S&P's Beers specifically cited the political gridlock as a reason for the disparity.
The higher interest payments we will have to make are far worse than equivalent taxes would have been because at least the tax money could have been used to pay off the deficit or fund a program. The interest payments are simply an additional cost with no additional benefit in return, at all. This was simply not necessary.
By the way, I'm not a Democrat. I think social security, medicare and defense should all see huge cuts across the board and I pretty much despise most entitlement programs but it doesn't change the fact that Republicans acted irresponsible toward bond holders and I do blame them more than Democrats for the downgrade because for their strategy of 1) tying the debt ceiling to the budget negotiations and 2) not compromising on new revenues, at all. I would have been fine with them doing either one alone but doing both was, in my opinion, irresponsible.
Do you understand that the debt ceiling needed to be raised to pay for money that was already spent? Under what circumstance is it ever logical to threaten not to pay a bill on services and goods already rendered? Clearly, ability was not an issue.
Imagine going to a restaurant with your 3 friends and ordering an appetizer that all of you agree to order. You all eat it. Now one of your friends is against what the other 2 want to order for the main course and threatens to prevent anyone from paying the bill for the appetizer if he doesn't get his way on the main meal. Do you think the restaurant wants to deal with this type of customer? If you can't agree on the main meal, fine, have a discussion about it. If you decide not to order it, that's fine with the restaurant, too. But don't threaten them to not pay for the appetizer? Irresponsible. If I were lending my money to a country, I wouldn't lend it to a country where a political minority has the ability (and willingness) to prevent the country from paying me back.
Refusal to accept any new revenues (Bush tax cuts were specifically cited by S&P in their downgrade) prevented the $4 trillion deal (an amount recommended by S&P) from passing. And playing a game of chicken with our bond holders until the 11th hour was equally bad. They don't want to wonder for weeks whether the kids in Washington will get their stuff together to repay them. They just want to get repaid - unconditionally. Just like I'm sure you want to be repaid - unconditionally - when you lend someone money.
The issue is both. What you describe is all true but you're incorrectly dismissing political risk. When politicians show they are willing to hold the debt ceiling hostage (and thus default) in order to push through political agenda, that increases the risk of not getting repaid, which from the point of view of a bond holder, is the only risk that matters. Either I think I'm going to get repaid or not. France and the UK arguably have worse balance sheets yet they have retained their AAA rating. The only difference I can think of is that their bond holders aren't at the mercy of a debt ceiling that could be held hostage by a political minority.
The idea of tying budget negotiations to the debt ceiling was a Republican one because it's the only way they were able to push their agenda through the Senate and President without compromise (and compromising is how democracies are intended to work, not, "we'll do this my way or bond holders don't get repaid"). My god, what if the Tea Party decides to tie Abortion the debt ceiling next? What they did was utterly irresponsible. If they want to debate the budget and cut the deficit going forward fine. Then let's have that debate but why threaten to not repay our bond holders if they don't get their way?
The whole idea of tying budget negotiations to the debt ceiling (i.e. to repaying for what's already been spent), essentially threatening not repay bond holders if they didn't get their way, was a Republican move. Debt ceiling increases used to be a formality but the Tea Party has shown that a minority is able to subvert the traditional democratic process by threatening to not raise the debt ceiling and thus to not repay bond holders. Suppose Tea Partiers decide to not raise the debt ceiling unless abortion is abolished? Their strategy of getting their way by threat of default as opposed to by trying to convince or compromise other members of congress - which is the true spirit of a democracy - was utterly irresponsible.
What? Raising the debt ceiling has has almost *always* been a formality until tea partiers decided to tie their budget demands to raising the ceiling (and thus to repaying our debt). Playing chicken with repaying our debt is obviously risky for our lenders, so this downgrade doesn't surprise me, at all.
I was extremely shocked by the whole debt ceiling hostage taking and am very happy that someone stood up and said enough is enough, your bickering and childish threatening of not repaying your debt will not go without consequences. I can only hope that politicians now understand that they need to change their "my way or the high way" ways and start compromising.
Do I really want to be stranded w/o cash just because I forgot to charge my battery or the phone stops working for some other reason? Credit cards work almost 100% of the time because even if they doesn't swipe, most places still have the ability to manually enter the numbers.
Lowering the prices of homes by 75% is by definition a housing collapse. Developers would no longer be able to repay Banks and as a result Banks would have to take massive losses. Does this sound familiar?
But you're right in the sense that lowering housing prices is the only solution to the problem. In other words, China is probably screwed. If you think moral hazard is bad in the US, think about how bad it is for China's state owned banks. The state has very low moral hazard (I say very low because if they screw up badly enough the public might revolt and replace them).
China artificially keeps their currency depressed (pegged to the US) by printing currency, which is indirectly paid for by people who hold the currency because their purchasing power decreases. So by pegging the yuan to the usd China is essentially transferring purchasing power from the public to the state, which explains the lack of consumption in spite of government spending and the ghost towns. Yes, they do get a boost in exports but considering that they only get it by essentially lowering prices, so it's not really much of a boost and that's why other countries don't do it. I would even go as far as arguing that China's trade partners benefit from a depressed currency because they have to give China less stuff in return for Chinese stuff. Sure, that means less employment but remember we're also giving them less stuff which requires less people to be employed. IMHO, the only odd guy out here is the Chinese public, which has one of the highest saving rates in the world at 38% compared to the US savings rate of less than 4%.
If China can figure out a way to transfer wealth back to the public so they can afford the ghost towns that have been built, China may be able to avoid a housing collapse but in order to do that they would have to destroy yuan but that money has already been spent...
I think China's willingness to do 'whatever is needed' is its biggest flaw because the road to hell is paved with good intentions.
My mobile phone can already share location information via the browser. dart.org's mobile site shows you the closest bus stops, so creating a similar site that shows the closest dui checkpoints is certainly possible... what would apple do then? ban the site from its browser?
Not saying that there isn't a conflict of interest here but the analogies fail because neither McDonald's nor Goldman Sachs are in the business of creating PSA's (basically advertisements) whereas NBC is, so you could argue that the Feds just outsourced the job to someone with expertise in the field.
I have an idea, let's call it the Turing Award!... seriously, though. There isn't a Nobel prize for Math, either, so it's no shock that there isn't one for computing.
I know it's fashionable to blame Microsoft around here but I seriously doubt that Nokia's sales have suffered because of their deal with Microsoft. Most of their customers probably don't even know about the deal with Microsoft. I think it's far more likely that their sales are suffering because their current phones simply aren't appealing to consumers, and that's probably the reason they decided to "orphan" their current phones. In other words, sales aren't bad because they orphaned their phones, it's the other way around.
Other companies that have ~$10B valuation: Cablevision, Whole Foods, Nordstrom, Southwest Airlines, NYSE, Dr Pepper/Snapple, Clorox, Mattel.
I would purchase any of these companies, which are all profitable, before I would purchase LinkedIn. LinkedIn is clearly overvalued and I suspect people will get burned within the next 3 months. There's also the risk of facebook killing this company in one fell swoop just like they killed Digg with their Like button and that risk is not reflected in the company's valuation.
IANAL but how are they able to go after the owner's assets? Isn't the entire purpose of creating a company to protect the owner's assets by limiting the liability to the company?
Acrobat is just as bad so I'm going to guess that their software engineers aren't as good as you think or they have serious management problems. Either way, the problem is with Adobe and not a technical one.
The flipside of that argument is that there's only so much you can squeeze out of a college student whereas Google has deep pockets. Patent trolls regularly go after companies with the deepest pockets and they seem to do just fine.
Slashdot Mirror
Gladly, but first you need to prove that the IP of your home machine is what you say it is.
It might be a coincidence but HP's stock started its decline when Hurd was replaced and hasn't recovered since. I wonder if the board regrets how it handled that situation.
I think the patents are a ruse. Motorola could have (and probably would have) teamed up with other Android makers to protect Android, anyway. Google could have enticed Motorola to do so for less than $12.5 billion. I also think Google is in it for the handset business and intends to adopt Apple's business model in the mobile area and go head to head with them. With this purchase, Google has become the 2nd largest handset maker by market cap and has deep enough pockets and mobile software know-how to make a dent in Apple's mobile dominance. Consider that Apple has a market cap of $380 billion and derives over half its revenue from selling iphones and ipads. If Google could only steal 1/10 of that market, this purchase would have been worth it. I think this acquisition is brilliant. Google is going to advertise these phones very strongly and I expect them to reap a large profit from the handset business.
You say that bond holders never had anything to worry about because you claim we would have been able to make payments on the interest. I don't agree with that but even if those claims were true, S&P explicitly stated that they would downgrade us to "D" or "Technical Default" had that happened, which I hope you agree would have been a horrible outcome, so I don't think it's terribly relevant whether we would have been able to continue paying interest or not. Furthermore, AAA is a "risk-free" rating and demanded by investors who can tolerate almost zero risk. Even if you have a 99% confidence interval that we would have been able to continue making payments (which I'm pretty sure you don't), a 1% risk of not getting paid is far too high for someone demanding AAA safety.
"Pay for money" is less ridiculous than it sounds. What are you paying for when you borrow money and are making interest payments? You're paying for the money you borrowed.
Of course there are devices that magically allow people to write IOUs. They're called credit cards. I agree that putting yourself in a position where you would need the IOU is irresponsible. We should not have ordered the appetizer but that ship has sailed. Again, if you think it's irresponsible to use *additional* IOUs, fine, by all means let's have that debate. But to say I won't allow the appetizer bill on the credit card unless I get my way on the main course is unacceptable under any condition.
I don't think Democrats are blameless. Cuts to social security and medicare simply must be made but to threaten bond holders by tying the debt ceiling to the budget negotiations was not responsible towards our lenders because they are an innocent third party and I was shocked that the Republicans were so willing to risk the full faith & credit of the U.S. in order to get their way on the budget. The S&P report specifically cited "prolonged controversy over raising the statutory debt ceiling" as well as "political risk" as one of the reasons for the downgrade. Note that France and the UK, which arguably have worse balance sheets than us (they're holding Greek, Portuguese and Italian bonds) retained their AAA and S&P's Beers specifically cited the political gridlock as a reason for the disparity.
The higher interest payments we will have to make are far worse than equivalent taxes would have been because at least the tax money could have been used to pay off the deficit or fund a program. The interest payments are simply an additional cost with no additional benefit in return, at all. This was simply not necessary.
By the way, I'm not a Democrat. I think social security, medicare and defense should all see huge cuts across the board and I pretty much despise most entitlement programs but it doesn't change the fact that Republicans acted irresponsible toward bond holders and I do blame them more than Democrats for the downgrade because for their strategy of 1) tying the debt ceiling to the budget negotiations and 2) not compromising on new revenues, at all. I would have been fine with them doing either one alone but doing both was, in my opinion, irresponsible.
Do you understand that the debt ceiling needed to be raised to pay for money that was already spent? Under what circumstance is it ever logical to threaten not to pay a bill on services and goods already rendered? Clearly, ability was not an issue.
Imagine going to a restaurant with your 3 friends and ordering an appetizer that all of you agree to order. You all eat it. Now one of your friends is against what the other 2 want to order for the main course and threatens to prevent anyone from paying the bill for the appetizer if he doesn't get his way on the main meal. Do you think the restaurant wants to deal with this type of customer? If you can't agree on the main meal, fine, have a discussion about it. If you decide not to order it, that's fine with the restaurant, too. But don't threaten them to not pay for the appetizer? Irresponsible. If I were lending my money to a country, I wouldn't lend it to a country where a political minority has the ability (and willingness) to prevent the country from paying me back.
Refusal to accept any new revenues (Bush tax cuts were specifically cited by S&P in their downgrade) prevented the $4 trillion deal (an amount recommended by S&P) from passing. And playing a game of chicken with our bond holders until the 11th hour was equally bad. They don't want to wonder for weeks whether the kids in Washington will get their stuff together to repay them. They just want to get repaid - unconditionally. Just like I'm sure you want to be repaid - unconditionally - when you lend someone money.
The issue is both. What you describe is all true but you're incorrectly dismissing political risk. When politicians show they are willing to hold the debt ceiling hostage (and thus default) in order to push through political agenda, that increases the risk of not getting repaid, which from the point of view of a bond holder, is the only risk that matters. Either I think I'm going to get repaid or not. France and the UK arguably have worse balance sheets yet they have retained their AAA rating. The only difference I can think of is that their bond holders aren't at the mercy of a debt ceiling that could be held hostage by a political minority.
The idea of tying budget negotiations to the debt ceiling was a Republican one because it's the only way they were able to push their agenda through the Senate and President without compromise (and compromising is how democracies are intended to work, not, "we'll do this my way or bond holders don't get repaid"). My god, what if the Tea Party decides to tie Abortion the debt ceiling next? What they did was utterly irresponsible. If they want to debate the budget and cut the deficit going forward fine. Then let's have that debate but why threaten to not repay our bond holders if they don't get their way?
The whole idea of tying budget negotiations to the debt ceiling (i.e. to repaying for what's already been spent), essentially threatening not repay bond holders if they didn't get their way, was a Republican move. Debt ceiling increases used to be a formality but the Tea Party has shown that a minority is able to subvert the traditional democratic process by threatening to not raise the debt ceiling and thus to not repay bond holders. Suppose Tea Partiers decide to not raise the debt ceiling unless abortion is abolished? Their strategy of getting their way by threat of default as opposed to by trying to convince or compromise other members of congress - which is the true spirit of a democracy - was utterly irresponsible.
What? Raising the debt ceiling has has almost *always* been a formality until tea partiers decided to tie their budget demands to raising the ceiling (and thus to repaying our debt). Playing chicken with repaying our debt is obviously risky for our lenders, so this downgrade doesn't surprise me, at all.
I was extremely shocked by the whole debt ceiling hostage taking and am very happy that someone stood up and said enough is enough, your bickering and childish threatening of not repaying your debt will not go without consequences. I can only hope that politicians now understand that they need to change their "my way or the high way" ways and start compromising.
I suspect China because the Google incident showed that they're actively engaged in such activities.
Do I really want to be stranded w/o cash just because I forgot to charge my battery or the phone stops working for some other reason? Credit cards work almost 100% of the time because even if they doesn't swipe, most places still have the ability to manually enter the numbers.
Lowering the prices of homes by 75% is by definition a housing collapse. Developers would no longer be able to repay Banks and as a result Banks would have to take massive losses. Does this sound familiar?
But you're right in the sense that lowering housing prices is the only solution to the problem. In other words, China is probably screwed. If you think moral hazard is bad in the US, think about how bad it is for China's state owned banks. The state has very low moral hazard (I say very low because if they screw up badly enough the public might revolt and replace them).
China artificially keeps their currency depressed (pegged to the US) by printing currency, which is indirectly paid for by people who hold the currency because their purchasing power decreases. So by pegging the yuan to the usd China is essentially transferring purchasing power from the public to the state, which explains the lack of consumption in spite of government spending and the ghost towns. Yes, they do get a boost in exports but considering that they only get it by essentially lowering prices, so it's not really much of a boost and that's why other countries don't do it. I would even go as far as arguing that China's trade partners benefit from a depressed currency because they have to give China less stuff in return for Chinese stuff. Sure, that means less employment but remember we're also giving them less stuff which requires less people to be employed. IMHO, the only odd guy out here is the Chinese public, which has one of the highest saving rates in the world at 38% compared to the US savings rate of less than 4%.
If China can figure out a way to transfer wealth back to the public so they can afford the ghost towns that have been built, China may be able to avoid a housing collapse but in order to do that they would have to destroy yuan but that money has already been spent ...
I think China's willingness to do 'whatever is needed' is its biggest flaw because the road to hell is paved with good intentions.
You could pay for it yourself by buying insurance ... and while it isn't cheap, you don't need to be Bill Gates to do that
I hate to admit it but I laughed ... shame on you.
My mobile phone can already share location information via the browser. dart.org's mobile site shows you the closest bus stops, so creating a similar site that shows the closest dui checkpoints is certainly possible ... what would apple do then? ban the site from its browser?
Not saying that there isn't a conflict of interest here but the analogies fail because neither McDonald's nor Goldman Sachs are in the business of creating PSA's (basically advertisements) whereas NBC is, so you could argue that the Feds just outsourced the job to someone with expertise in the field.
I have an idea, let's call it the Turing Award! ... seriously, though. There isn't a Nobel prize for Math, either, so it's no shock that there isn't one for computing.
I know it's fashionable to blame Microsoft around here but I seriously doubt that Nokia's sales have suffered because of their deal with Microsoft. Most of their customers probably don't even know about the deal with Microsoft. I think it's far more likely that their sales are suffering because their current phones simply aren't appealing to consumers, and that's probably the reason they decided to "orphan" their current phones. In other words, sales aren't bad because they orphaned their phones, it's the other way around.
Ahem, that's 511. The left pinky finger is reserved for the sign
Apple knows what's going on at Foxconn but still choose to do business with them. Outsourcing your dirty work does not absolve you of responsibility.
Other companies that have ~$10B valuation: Cablevision, Whole Foods, Nordstrom, Southwest Airlines, NYSE, Dr Pepper/Snapple, Clorox, Mattel.
I would purchase any of these companies, which are all profitable, before I would purchase LinkedIn. LinkedIn is clearly overvalued and I suspect people will get burned within the next 3 months. There's also the risk of facebook killing this company in one fell swoop just like they killed Digg with their Like button and that risk is not reflected in the company's valuation.
IANAL but how are they able to go after the owner's assets? Isn't the entire purpose of creating a company to protect the owner's assets by limiting the liability to the company?
Acrobat is just as bad so I'm going to guess that their software engineers aren't as good as you think or they have serious management problems. Either way, the problem is with Adobe and not a technical one.
The flipside of that argument is that there's only so much you can squeeze out of a college student whereas Google has deep pockets. Patent trolls regularly go after companies with the deepest pockets and they seem to do just fine.