I think the articles I've read tried to chalk this up to the slow growth of the economy generally. There just aren't enough productive investments to put the money into.
I don't personally subscribe to that theory. I think there are plenty of productive investments available today. Arguments about the economy being slow are fig leaf excuses. Frankly what better time to buy at a good price than when prices are depressed by economic conditions? No, the problem is something else.
The problem is that there are not a lot of huge investments available that will return 25% net margins like Apple, Google and Microsoft are accustomed to. Any of them could buy any but a handful of companies on the planet in cash. Many of these firms are very profitable. Just not 25% net margins profitable. For a company the size of Apple to move the needle on their net income, they need to generate businesses worth tens of billions of dollars. But they also know that if they were to do something like buying Ford, they would piss off shareholders who are very pleased with 25% net margins and now have to deal with 5% net margins on the business acquired.
The "cash" they hold isn't held as actual cash, it's just very liquid investments.
A distinction without a real difference. You'll see it on the balance sheet as "Cash and Cash Equivalents". For all practical purposes it is cash and it's well understood that they don't actually have a pile of bills sitting in a vault somewhere. (or at least we should hope they don't)
Even if they did hold it in "cash" it wouldn't be cash, it would be a current account balance with a bank.
Again, largely correct but also an unimportant distinction. The cash is theirs to withdraw whenever they want it. The fact that it is held in a bank or held in coffee can in the back yard is something of an academic distinction except in very rare circumstances.
That bank is VERY busy investing that money elsewhere
Just because the bank is (in theory) lending that money out doesn't mean that is an optimal use of that capital. And in practice, the banks have tightened lending standards over the past few years so they aren't putting as much capital to work as they could. You are quite correct that the bank is putting substantial amounts of that money to work but a lot of it is tied up in things like Treasury Bills which are of rather modest value towards economic growth.
Eliminate the business tax on repatriating funds if the business distributes 10% of the repatriated funds as a one time dividend to shareholders.
One time distributions won't solve the problem. It just creates an incentive to wait for the tax amnesty the next time. They've actually done a one time tax amnesty before with predictable results. No, you need to actually change the laws so that it is economically attractive to repatriate the funds. Could be done by eliminating corporate taxes and taxing all income (corporate or personal) at the personal level like they do for S-Corps. (I'm overly simplifying here but you get the idea) That way the corporation has no reason to not repatriate the funds since the shareholders are going to pay taxes on it whether or not it is repatriated.
The problem isn't hard to solve but it would require the US to elect a Congress that doesn't break out in hives every time the word tax is spoken.
Presumably having this much capital tied up in short-term non-working assets is suboptimal in a macroeconomic sense.
No need to qualify that statement. It definitely is sub-optimal in a macro and micro economic sense. Basically it means those companies have no idea how to make productive use of that capital.
I'm also curious how shareholders feel about this.
I'm not a shareholder in these companies but I would have mixed feelings about it. On one hand having a fortress of a balance sheet makes investing in the company extremely safe. Even if Apple were to stop selling iPhones tomorrow, they literally could buy another Fortune 100 company in cash if they needed to. With as much cash as these companies have it would take an act of malfeasance on the scale of Enron for them to go out of business. On the other hand if they have that much cash stored away it clearly indicates that they don't have any ideas about how to put it to productive use. That being the case it would make sense to either substantially increase the dividend or buy back lots more shares.
Honestly I suspect that sooner or later you're going to get activist investors who will look at those piles of cash and see them as the idle assets they are. I think all three of them are going to have to do some rather substantial acquisitions or they will be forced to distribute a large portion of their cash hoards.
last time i checked,/. isn't marketwatch.com, so fuck the investors because they are parasites on society.
Everybody, including you, is an investor. So basically you are saying fuck yourself and everybody else too. Investors aren't some abstract class of rich people. Everybody invests their money in something. Everybody. Including people who read slashdot. Believe it or not some of us are engineers who also find financial markets interesting. Smart people invest their money in companies and assets that will generate a return on that investment. To generate a return those assets need to grow and become more valuable. You wondered why companies are forced to grow every year and I answered your question. You seem uncomfortable with the truth but it is the truth nonetheless.
what is with the retarded notion that if you aren't making significantly more money than you made last year that you are somehow not being profitable enough?
Because investors don't invest in a company to maintain the status quo. Investors expect a return on their investment and that means you either have to kick off a lot of highly predictable cash at a rate substantially above inflation or you have to grow the company. Furthermore the returns (growth) you generate need to be higher than alternative investments of a similar risk profile or else investors will invest their cash elsewhere. If an investor can get a 10% return on their investment with Company A and "only" a 5% return from Company B, why would they ever invest with Company B if the risk profile was similar?
Yes this means that growing a large company is a LOT harder than growing a small one in many ways. For Apple to grow by just 5% next year they would have to create enough new business to build a company the size of eBay from scratch. In ONE year. That's really hard to do. The investor does not care however. They want a return on THEIR money. The difficulty of providing that return is the problem of the company, not the investor.
Don't think about this like a financial engineer, not a civil engineer. It doesn't matter what makes the most sense from a technical perspective, what matters is not disrupting cash flow for entrenched industries.
Well I am an accountant and an engineer. You are right about progress following the path of least economic resistance but I think you have that path misidentified. Part of the flaw in your argument is in thinking there is just one big industry in the fight here. Basically you will be pitting the electric generation companies against the refining companies. Except not really or at least not immediately.
The least disruptive technology is actually plug in hybrids because it bridges both types of infrastructure. It can behave exactly as current gas powered cars do. As battery technology gets better you'll see the range of the electric vehicles go up and the charging times go down and the charging infrastructure get built out. Eventually you reach a tipping point.where it makes sense to go all electric and drop the second engine. In the mean time the gas station still sells fuel, the electric company gets time to beef up their already existing infrastructure and you don't have to introduce any truly different infrastructure like compressed gas or specialty chemicals.
To make fuel cell vehicles work you have to build out all new infrastructure everywhere all at once and to date they are behind the curve in performance. There is no consensus on what form hydrogen should be distributed in or how it should be implemented on the vehicle. With hybrids you can incrementally solve the problem today. I don't think it is very likely that fuel cells will make some miraculous technological leap that will make building out all that extra infrastructure economically worthwhile in the near future.
Electric cars upend multiple industries - from oil services all the way to convenience stores. Change will be fought tooth-and-nail. I just hope Elon doesn't run out of cash before he's had a chance to force the issue on electric cars.
That's why you'll see hybrids first. Hybrids don't completely upset the apple cart and provide a transition technology. Plus you have to remember that there is the electrical grid which provides competing infrastructure to the fossil fuel system. The problem with hydrogen is that unless you can turn it into some sort of liquid form, the existing infrastructure for gasoline refueling is really no better than the electrical grid. Either way you have a substantial build out. Just because hydrogen is a chemical doesn't necessarily mean you can drop it right in place of the gasoline delivery system.
Civilization itself isn't a need. Neither are food and shelter.
Yes they are if you want to continue to exist. If you actually consider suicide an real option then go back to reading your nihilistic philosophy books and stop bothering the rest of us.
Since your claim that Las Vegas constitutes a needless use of power did not contain a scope, I think it is fair to say that it represented an opinion.
So instead of using your brain and a little common sense you decided to waste time on some nonsensical rhetorical arguments using Reductio Ad Absurdum about the scope of my argument. I'm pretty sure you're smart enough to figure out what I meant without me explicitly explaining the entire scope of my argument. Do so.
People want all sorts of things that aren't good ideas. Building a major city in the middle of a desert when you have other options available to you is the very definition of an idiotic idea. The amount of water and energy resources that have been diverted from more sensible uses to supply places like Phoenix and Las Vegas are obscene.
You speak of the Las Vegas of today, when the city was established it was known for it's numerous natural springs
The Las Vegas of today is the only one we have. Whatever local water supplies it naturally has ceased to be adequate a looong time ago in order to feed utterly pointless displays like the fountains at the Bellagio. Vast amounts of water resources have been diverted to supply a city that never should have gotten larger than a small town. I've ever heard people from Nevada talk about ideas like diverting the Mississippi or the Great Lakes to supply water to the idiocy that is Las Vegas.
Sorry but true. They're rolling out some promising early models but they have not seen widespread adoption and their economic viability is still unproven though looking better every day. Current versions are still comparatively small compared with generating capacity and are still in testing. It seems we are right on the cusp I think. Please note I'm not disagreeing with you about their potential. It think they are very promising and not far from being a really helpful tool. I don't think there are any obvious showstoppers to economic viability of flywheels so I would expect to see them getting used more and more. But widespread deployment is still in the future - probably the near future.
If AI becomes the next big thing, they will just buy their way into the game with acquisitions. Or they'll buy their way into a whole new market.
Not if Alphabet (Google) or Microsoft buy it first. Microsoft and Google have comparable amounts of cash to Apple. Facebook may become a player as well and they're pretty cash rich. Amazon's biggest problem will be that it doesn't have as big a war chest as the others but it's still not a competitor to overlook.
Blackberry never had anywhere close to the money Apple does, it's like comparing apples to prime rib.
True though back ten years ago when Blackberry dropped the ball, Apple didn't have anywhere close to the amount of cash it does today either.
They're both fairly pointless ideas now that we have the technology to build magnetically levitated flywheels in vacuum vessels. They have very low loss, they take up very little power, they cost very little to build, they store fairly enormous quantities of energy, and they are very efficient.
And yet nobody has found an economically viable way to make this miraculous device and deploy it at industrial scale. Perhaps they aren't quite everything you are making them out to be just yet?
Seriously the idea of large flywheels to store energy has logic to it and has been proven at smaller scales. We're just not quite there yet for industrial scale use. Maybe soon hopefully.
Incorrect. "Want" is a matter of opinion. "Need" is not optional by definition. Sometimes people confuse the needs with wants but they are not the same thing.
To be fair... it does make some sense that these two things would chase each other around in circles.
I think you are correct. Necessity is the mother of invention and apparently invention can be the mother of necessity too. The amount of wasted human effort involved in making a major metropolis in the middle of a desert in a location with zero natural resources to justify its existence is astonishing. Same thing applies to Phoenix. Great examples of doing something because we can without stopping to wonder if we should.
Citing Tesla's factory, the magazine callsthe project "further evidence for Nevadaâ(TM)s emergence as a leading region for innovative transportation and energy projects."
And the existence of Las Vegas is evidence for Nevada as a leading region for innovations in ways to needlessly waste energy and resources.
It's actually about giving the rest of society an incentive to not engage in the same crimes for which someone else was found guilty.
No it isn't. The US has gone WAY beyond the level of penalties that have a beneficial effect in deterring crime. The US has the highest incarceration rate of any industrialized nation and yet it doesn't have lower crime rates. In fact the US has HIGHER rates of several types of violent crimes. No, the penalties that are handed out and conditions of the prisons has everything to do with politics and very little to do with crime prevention. Being "tough on crime" gets votes regardless of the effectiveness or morality of the actions that result.
Just like the police do not come until a crime is happening, or after the fact, a disincentive can not be given until someone is judged guilty by a jury of their peers.
Police routinely show up in places where a crime is reasonably likely to occur. Police being present in a location with no crime being committed mostly makes it less likely that a crime will occur. Happens all the time.
Handing out increasingly disproportional punishments for crimes does nothing to improve deterrence of crimes further.
The police are not there to save you from a crime, they are there to clean up after the fact.
Incorrect. They are there for both purposes. Police are both a deterrent and and enforcement mechanism.
Well, I'm an accountant and an engineer and I run a manufacturing company for a living. I'm giving you facts. Believe me or not, I don't really care. But if you bother to check you'll find that I'm correct on this matter. Handset makers use Android precisely because it is cheap for them to adapt. Putting a skin on Android is trivial and cheap, especially if the company never bothers to support it post sale.
Users care. Users buy. Advantage.
Some users care but most don't give a shit. Users buy more Android phones than other type and demonstrably do not care since they continue to buy them in the face of a lack of updates by most Android device makers. There are some Android device makers that do update their devices and thus far they have realized little to no competitive advantage as a result. Go ahead and find me any example of an Android handset maker that has realized any competitive advantage from software updates. I'll wait.
I still don't believe you.
And I still don't care. Go ahead and check for yourself. You don't have to believe me to figure out that I'm right.
It's not about hardware innovations.
If you are trying to differentiate on hardware you have to have something more than a pretty shell. So yeah, it is very much about hardware innovation if you want to capture and keep market share via hardware.
It's about style, consistent quality, and fashion.
Which are fickle, easily copied or trumped and demonstrably not a sustainable source of competitive advantage. The reasons people bought Nokia phones were deeper than style or hardware quality. The reasons they stopped buying them were likewise deeper than style or quality. Style and quality matter but they aren't enough by themselves. Software, platform, distribution, brand, features, cost, and more all matter quite a lot. A lot of the reason Nokia did well 10+ years ago was because they were actually one of the lowest cost manufacturers and a good brand. They had economies of scale and competed on price across much of their product line. Nokia phones never sold for substantial premiums - they just sold a lot of them.
For a time Nokia made some of the best phones available. Unfortunately it turned out this had a lot to do with the shitty quality of the software and interfaces industry wide. Prior to the iPhone handset makers thought their customer was the carriers and the only thing the carriers cared about was moving units and plans. After the iPhone proved this wasn't the case, Nokia couldn't adapt in time. Their phones were ok but eventually customers realized that they couldn't do some really useful things (like web browsing and email) with them. I had a Nokia "smartphone" myself which on paper actually seemed to have better features than the iPhone but in reality none of them really worked worth a shit whereas the ones on the iPhone did. Technically you could surf the web but the experience was beyond painful. By the time they got devices on the market that were competitive it was already too late. Their brand, low cost manufacturing, reliable hardware and other advantages were not enough.
They just fucked up royally on the software-front. Which is the only point I was trying to make.
Yes they did screw up on software. Bad. But that wasn't the only mistake Nokia made. Some Chinese companies taking over the brand isn't going to bring Nokia back from the dead. They have no competitive advantage.
The Lumia phones are still great devices from a design and hardware point of view. Unique even.
I'm sure they are excellent devices but what unique value do they provide that people will actually preferentially pay for? What feature do they have that nobody else has, nobody can copy and that large numbers of people are going to line up to pay cash money for? Maybe they can find a niche but hardware innovations in phones aren't coming so fast these days. Minor incremental and easily copied innovations aren't going to get the job done and aren't strategically defensible.
Let's use Apple for an example. Apple's hardware is generally acknowledged to be upper tier. It might not always be the very best or latest but it's always right up there. But if you put Android on an iPhone, nobody would have any reason to pay a premium for it and customers would have a hard time justifying buying it over any number of other competing Android devices. What makes the iPhone different is the software. The only place you can get iOS is on an iPhone. THAT is why people buy them and pay a premium for them. Without iOS, Apple has to compete on price and distribution and there can really only be one winner in that game. (it's currently Samsung) Apple knows they need good hardware but they also know that they can't reliably deliver hardware that isn't available to or readily copied by their competitors. Trying to differentiate on hardware alone is doomed to failure.
The software and cost advantage could come from "Just run stock Android and focus on the fucking hardware" (tm) instead of blowing tons of cash on custom skins nobody really wants and which hugely complicate software updates.
I think you misunderstand the economics at work here. The software costs on these are comparatively minor. Even if they run bone stock Android that doesn't mean they will have a meaningful cost advantage. Android device makers (mostly) don't care much about updates anyway so it's a non-cost to them. The cost of developing a skin and a few proprietary bits is tiny compared with the cost of developing, making, distributing and selling the hardware. And if they do go stock Android, what prevents another company from copying whatever hardware innovations they might come up with? Samsung basically cloned some of Apple's devices and largely got away with it and Apple has bottomless cash to hire flesh eating lawyers.
While it's not impossible I just don't see a situation where this new Nokia is anything other than another Me Too player with Me Too products in an already crowded market. They're trying to revive a tarnished brand that nobody really cares about anymore without the authenticity that made the brand successful in the first place.
The thing that Nokia should have done more than a decade ago. Build their great hardware and run Android on it.
And profit how exactly? There are companies that make darn good hardware for the Android platform but make basically zero profit or less. Only Samsung has managed to make any meaningful profit on Android. What does Nokia bring to the party that will displace Samsung? A nice piece of hardware alone won't be enough. They either need software to differentiate their product or they need a cost advantage or a distribution advantage. I can't really see any of those being likely.
Yes it did. For a long time. It probably would have continued to work if Lance hadn't been such a dick to so many people. Lots of other people from his era got caught doping and few of them were punished anywhere near as hard. Lance got greedy and arrogant and seemed to think he could never get caught.
Anyway he was tested and he tested clean. All that means is that there was no evidence of the drug in his system at the time he was tested. It doesn't mean he wasn't using some PED that they weren't testing for or something the didn't have a test for or that had been flushed from his system prior to the test. Basically doping controls mostly catch the athletes who don't know what they are doing or who get sloppy or just unlucky.
Aren't they dealing with the most urgent/critical cases when they are on call?
Not necessarily. Being on call just means you are available for cases that come in. It doesn't necessarily mean a given patient's case will be more serious than normal. Probably a higher percentage of cases are of the urgent/severe type but not all of them. Frequently on-call is just for monitoring in case an issue crops up, managing staff or to be available just in case something urgent crops up.
It's kind of like holding the off hours pager when you do IT support. Most of the stuff you'll deal with is fairly routine stuff that just as easily could have popped up during the day. Sometimes it's of the more severe variety.
Apple is "fairly valued", it's only in terms about what people know about Apple today - it does not take into account the imminent growth on many fronts along with new products to launch in upcoming years.
ALL stock prices include expectations about future prospects of the company. It absolutely does take into account expectations regarding growth and new products. If you believe in some form of the efficient market hypothesis (and you should) then you would understand this.
The stock price is much lower than it would be if people looked at the stock rationally.
Because the market doesn't agree with your assessment it isn't rational? While it's conceivable you are right it's mighty presumptuous of you to presume that most other investors in Apple is being irrationally pessimistic. Markets are pretty smart and the number of people who can outperform them is pretty small. Unless you have a track record like Warren Buffet you might consider taking a more humble approach. Just because you think it should be worth more doesn't mean you are right.
How many BEFORE Jobs died? Just one. Amazing and highly performant products take time.
Come again? Hit NEW products released under Jobs after he returned to the company include: iMac, iPod, iPhone, iPad, iTunes. Since Jobs died: none. Now I'm willing to give them some time. Apple historically has introduces 1-2 big hit products per decade. But their last big one was the iPad which was introduced 6 years ago. Aside from a few minor products (Apple Watch, etc) Apple hasn't released anything since major Jobs died aside from some solid but incremental improvements to existing products. Now obviously they've got some stuff in development but that guarantees nothing. Apple has had major flops before and it's certainly possible they'll have another one at some point.
But there's a lot of argument to be made that Amazon has reached a point of saturation also and will not have nearly so rapid growth going forward.
Possible but you aren't presenting any actual evidence to back you up. Amazon's growth rate hasn't slowed at all as of the end of 2015. To argue that Amazon's growth prospects are diminishing you need to actually back that up with something other than wishful thinking.
The only reason the Amazon stock is so high right now is because of services but Apple has a MORE compelling services growth picture than even Amazon.
Not seeing the evidence to back you up here either and I'm watching both companies rather closely. Apple isn't really in web services much - not like Amazon is. Apple could be but so far they haven't gone after that market. Both are in media and both are doing rather well.
And that's just services, never mind many other physical products Apple makes that are doing very well, unlike the Fire...
I think you misunderstand the purpose of the Kindle devices including the Fire line. Amazon makes their money from selling ebooks and other content. They basically give the devices away at cost. Like Google they don't make their money by selling devices. It's almost the exact opposite model from Apple which uses content to drive device sales. Neither is a bad model but you can't evaluate them as if they are the same thing. Both are tech companies whose core competency is software but their business models couldn't be more different.
Which Royal Dutch Shell are you talking about? I'm looking at quote.yahoo.com, RDS-B, and it says the yield is 3.76.
RDS.A and RDS.B are the same company. The difference is one stock is denominated in Euros and the other in Pounds Sterling. Otherwise they are the same. Current dividend yield is close to identical for either. Currently hovering at around 7.4% and has been bouncing between 7-8% for a while now.
Furthermore, the stock has gone between $36-$64 in 52 weeks (rounded), as opposed to Apple $90-$133.. So RDS had a much bigger percentage swing in a year..
That's a function of the swings in the price of oil recently. There currently is a surplus of oil on the market so unit price of oil is down and thus so are energy stocks. The price of oil will head back up eventually and so will the stocks along with it. Frankly now is a pretty good time to buy oil stocks like RDS and XOM. Those companies aren't going out of business, the stock price is low but the company fundamentals are solid and unchanged, the companies are still hugely profitable and the dividend yields are outstanding.
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I think the articles I've read tried to chalk this up to the slow growth of the economy generally. There just aren't enough productive investments to put the money into.
I don't personally subscribe to that theory. I think there are plenty of productive investments available today. Arguments about the economy being slow are fig leaf excuses. Frankly what better time to buy at a good price than when prices are depressed by economic conditions? No, the problem is something else.
The problem is that there are not a lot of huge investments available that will return 25% net margins like Apple, Google and Microsoft are accustomed to. Any of them could buy any but a handful of companies on the planet in cash. Many of these firms are very profitable. Just not 25% net margins profitable. For a company the size of Apple to move the needle on their net income, they need to generate businesses worth tens of billions of dollars. But they also know that if they were to do something like buying Ford, they would piss off shareholders who are very pleased with 25% net margins and now have to deal with 5% net margins on the business acquired.
The "cash" they hold isn't held as actual cash, it's just very liquid investments.
A distinction without a real difference. You'll see it on the balance sheet as "Cash and Cash Equivalents". For all practical purposes it is cash and it's well understood that they don't actually have a pile of bills sitting in a vault somewhere. (or at least we should hope they don't)
Even if they did hold it in "cash" it wouldn't be cash, it would be a current account balance with a bank.
Again, largely correct but also an unimportant distinction. The cash is theirs to withdraw whenever they want it. The fact that it is held in a bank or held in coffee can in the back yard is something of an academic distinction except in very rare circumstances.
That bank is VERY busy investing that money elsewhere
Just because the bank is (in theory) lending that money out doesn't mean that is an optimal use of that capital. And in practice, the banks have tightened lending standards over the past few years so they aren't putting as much capital to work as they could. You are quite correct that the bank is putting substantial amounts of that money to work but a lot of it is tied up in things like Treasury Bills which are of rather modest value towards economic growth.
Eliminate the business tax on repatriating funds if the business distributes 10% of the repatriated funds as a one time dividend to shareholders.
One time distributions won't solve the problem. It just creates an incentive to wait for the tax amnesty the next time. They've actually done a one time tax amnesty before with predictable results. No, you need to actually change the laws so that it is economically attractive to repatriate the funds. Could be done by eliminating corporate taxes and taxing all income (corporate or personal) at the personal level like they do for S-Corps. (I'm overly simplifying here but you get the idea) That way the corporation has no reason to not repatriate the funds since the shareholders are going to pay taxes on it whether or not it is repatriated.
The problem isn't hard to solve but it would require the US to elect a Congress that doesn't break out in hives every time the word tax is spoken.
Presumably having this much capital tied up in short-term non-working assets is suboptimal in a macroeconomic sense.
No need to qualify that statement. It definitely is sub-optimal in a macro and micro economic sense. Basically it means those companies have no idea how to make productive use of that capital.
I'm also curious how shareholders feel about this.
I'm not a shareholder in these companies but I would have mixed feelings about it. On one hand having a fortress of a balance sheet makes investing in the company extremely safe. Even if Apple were to stop selling iPhones tomorrow, they literally could buy another Fortune 100 company in cash if they needed to. With as much cash as these companies have it would take an act of malfeasance on the scale of Enron for them to go out of business. On the other hand if they have that much cash stored away it clearly indicates that they don't have any ideas about how to put it to productive use. That being the case it would make sense to either substantially increase the dividend or buy back lots more shares.
Honestly I suspect that sooner or later you're going to get activist investors who will look at those piles of cash and see them as the idle assets they are. I think all three of them are going to have to do some rather substantial acquisitions or they will be forced to distribute a large portion of their cash hoards.
last time i checked, /. isn't marketwatch.com, so fuck the investors because they are parasites on society.
Everybody, including you, is an investor. So basically you are saying fuck yourself and everybody else too. Investors aren't some abstract class of rich people. Everybody invests their money in something. Everybody. Including people who read slashdot. Believe it or not some of us are engineers who also find financial markets interesting. Smart people invest their money in companies and assets that will generate a return on that investment. To generate a return those assets need to grow and become more valuable. You wondered why companies are forced to grow every year and I answered your question. You seem uncomfortable with the truth but it is the truth nonetheless.
what is with the retarded notion that if you aren't making significantly more money than you made last year that you are somehow not being profitable enough?
Because investors don't invest in a company to maintain the status quo. Investors expect a return on their investment and that means you either have to kick off a lot of highly predictable cash at a rate substantially above inflation or you have to grow the company. Furthermore the returns (growth) you generate need to be higher than alternative investments of a similar risk profile or else investors will invest their cash elsewhere. If an investor can get a 10% return on their investment with Company A and "only" a 5% return from Company B, why would they ever invest with Company B if the risk profile was similar?
Yes this means that growing a large company is a LOT harder than growing a small one in many ways. For Apple to grow by just 5% next year they would have to create enough new business to build a company the size of eBay from scratch. In ONE year. That's really hard to do. The investor does not care however. They want a return on THEIR money. The difficulty of providing that return is the problem of the company, not the investor.
Don't think about this like a financial engineer, not a civil engineer. It doesn't matter what makes the most sense from a technical perspective, what matters is not disrupting cash flow for entrenched industries.
Well I am an accountant and an engineer. You are right about progress following the path of least economic resistance but I think you have that path misidentified. Part of the flaw in your argument is in thinking there is just one big industry in the fight here. Basically you will be pitting the electric generation companies against the refining companies. Except not really or at least not immediately.
The least disruptive technology is actually plug in hybrids because it bridges both types of infrastructure. It can behave exactly as current gas powered cars do. As battery technology gets better you'll see the range of the electric vehicles go up and the charging times go down and the charging infrastructure get built out. Eventually you reach a tipping point.where it makes sense to go all electric and drop the second engine. In the mean time the gas station still sells fuel, the electric company gets time to beef up their already existing infrastructure and you don't have to introduce any truly different infrastructure like compressed gas or specialty chemicals.
To make fuel cell vehicles work you have to build out all new infrastructure everywhere all at once and to date they are behind the curve in performance. There is no consensus on what form hydrogen should be distributed in or how it should be implemented on the vehicle. With hybrids you can incrementally solve the problem today. I don't think it is very likely that fuel cells will make some miraculous technological leap that will make building out all that extra infrastructure economically worthwhile in the near future.
Electric cars upend multiple industries - from oil services all the way to convenience stores. Change will be fought tooth-and-nail. I just hope Elon doesn't run out of cash before he's had a chance to force the issue on electric cars.
That's why you'll see hybrids first. Hybrids don't completely upset the apple cart and provide a transition technology. Plus you have to remember that there is the electrical grid which provides competing infrastructure to the fossil fuel system. The problem with hydrogen is that unless you can turn it into some sort of liquid form, the existing infrastructure for gasoline refueling is really no better than the electrical grid. Either way you have a substantial build out. Just because hydrogen is a chemical doesn't necessarily mean you can drop it right in place of the gasoline delivery system.
Civilization itself isn't a need. Neither are food and shelter.
Yes they are if you want to continue to exist. If you actually consider suicide an real option then go back to reading your nihilistic philosophy books and stop bothering the rest of us.
Since your claim that Las Vegas constitutes a needless use of power did not contain a scope, I think it is fair to say that it represented an opinion.
So instead of using your brain and a little common sense you decided to waste time on some nonsensical rhetorical arguments using Reductio Ad Absurdum about the scope of my argument. I'm pretty sure you're smart enough to figure out what I meant without me explicitly explaining the entire scope of my argument. Do so.
Many people want to live in Phoenix.
People want all sorts of things that aren't good ideas. Building a major city in the middle of a desert when you have other options available to you is the very definition of an idiotic idea. The amount of water and energy resources that have been diverted from more sensible uses to supply places like Phoenix and Las Vegas are obscene.
You speak of the Las Vegas of today, when the city was established it was known for it's numerous natural springs
The Las Vegas of today is the only one we have. Whatever local water supplies it naturally has ceased to be adequate a looong time ago in order to feed utterly pointless displays like the fountains at the Bellagio. Vast amounts of water resources have been diverted to supply a city that never should have gotten larger than a small town. I've ever heard people from Nevada talk about ideas like diverting the Mississippi or the Great Lakes to supply water to the idiocy that is Las Vegas.
Sorry but true. They're rolling out some promising early models but they have not seen widespread adoption and their economic viability is still unproven though looking better every day. Current versions are still comparatively small compared with generating capacity and are still in testing. It seems we are right on the cusp I think. Please note I'm not disagreeing with you about their potential. It think they are very promising and not far from being a really helpful tool. I don't think there are any obvious showstoppers to economic viability of flywheels so I would expect to see them getting used more and more. But widespread deployment is still in the future - probably the near future.
If AI becomes the next big thing, they will just buy their way into the game with acquisitions. Or they'll buy their way into a whole new market.
Not if Alphabet (Google) or Microsoft buy it first. Microsoft and Google have comparable amounts of cash to Apple. Facebook may become a player as well and they're pretty cash rich. Amazon's biggest problem will be that it doesn't have as big a war chest as the others but it's still not a competitor to overlook.
Blackberry never had anywhere close to the money Apple does, it's like comparing apples to prime rib.
True though back ten years ago when Blackberry dropped the ball, Apple didn't have anywhere close to the amount of cash it does today either.
They're both fairly pointless ideas now that we have the technology to build magnetically levitated flywheels in vacuum vessels. They have very low loss, they take up very little power, they cost very little to build, they store fairly enormous quantities of energy, and they are very efficient.
And yet nobody has found an economically viable way to make this miraculous device and deploy it at industrial scale. Perhaps they aren't quite everything you are making them out to be just yet?
Seriously the idea of large flywheels to store energy has logic to it and has been proven at smaller scales. We're just not quite there yet for industrial scale use. Maybe soon hopefully.
"Need" is a matter of opinion.
Incorrect. "Want" is a matter of opinion. "Need" is not optional by definition. Sometimes people confuse the needs with wants but they are not the same thing.
To be fair... it does make some sense that these two things would chase each other around in circles.
I think you are correct. Necessity is the mother of invention and apparently invention can be the mother of necessity too. The amount of wasted human effort involved in making a major metropolis in the middle of a desert in a location with zero natural resources to justify its existence is astonishing. Same thing applies to Phoenix. Great examples of doing something because we can without stopping to wonder if we should.
Citing Tesla's factory, the magazine callsthe project "further evidence for Nevadaâ(TM)s emergence as a leading region for innovative transportation and energy projects."
And the existence of Las Vegas is evidence for Nevada as a leading region for innovations in ways to needlessly waste energy and resources.
It's actually about giving the rest of society an incentive to not engage in the same crimes for which someone else was found guilty.
No it isn't. The US has gone WAY beyond the level of penalties that have a beneficial effect in deterring crime. The US has the highest incarceration rate of any industrialized nation and yet it doesn't have lower crime rates. In fact the US has HIGHER rates of several types of violent crimes. No, the penalties that are handed out and conditions of the prisons has everything to do with politics and very little to do with crime prevention. Being "tough on crime" gets votes regardless of the effectiveness or morality of the actions that result.
Just like the police do not come until a crime is happening, or after the fact, a disincentive can not be given until someone is judged guilty by a jury of their peers.
Police routinely show up in places where a crime is reasonably likely to occur. Police being present in a location with no crime being committed mostly makes it less likely that a crime will occur. Happens all the time.
Handing out increasingly disproportional punishments for crimes does nothing to improve deterrence of crimes further.
The police are not there to save you from a crime, they are there to clean up after the fact.
Incorrect. They are there for both purposes. Police are both a deterrent and and enforcement mechanism.
I don't believe you.
Well, I'm an accountant and an engineer and I run a manufacturing company for a living. I'm giving you facts. Believe me or not, I don't really care. But if you bother to check you'll find that I'm correct on this matter. Handset makers use Android precisely because it is cheap for them to adapt. Putting a skin on Android is trivial and cheap, especially if the company never bothers to support it post sale.
Users care. Users buy. Advantage.
Some users care but most don't give a shit. Users buy more Android phones than other type and demonstrably do not care since they continue to buy them in the face of a lack of updates by most Android device makers. There are some Android device makers that do update their devices and thus far they have realized little to no competitive advantage as a result. Go ahead and find me any example of an Android handset maker that has realized any competitive advantage from software updates. I'll wait.
I still don't believe you.
And I still don't care. Go ahead and check for yourself. You don't have to believe me to figure out that I'm right.
It's not about hardware innovations.
If you are trying to differentiate on hardware you have to have something more than a pretty shell. So yeah, it is very much about hardware innovation if you want to capture and keep market share via hardware.
It's about style, consistent quality, and fashion.
Which are fickle, easily copied or trumped and demonstrably not a sustainable source of competitive advantage. The reasons people bought Nokia phones were deeper than style or hardware quality. The reasons they stopped buying them were likewise deeper than style or quality. Style and quality matter but they aren't enough by themselves. Software, platform, distribution, brand, features, cost, and more all matter quite a lot. A lot of the reason Nokia did well 10+ years ago was because they were actually one of the lowest cost manufacturers and a good brand. They had economies of scale and competed on price across much of their product line. Nokia phones never sold for substantial premiums - they just sold a lot of them.
For a time Nokia made some of the best phones available. Unfortunately it turned out this had a lot to do with the shitty quality of the software and interfaces industry wide. Prior to the iPhone handset makers thought their customer was the carriers and the only thing the carriers cared about was moving units and plans. After the iPhone proved this wasn't the case, Nokia couldn't adapt in time. Their phones were ok but eventually customers realized that they couldn't do some really useful things (like web browsing and email) with them. I had a Nokia "smartphone" myself which on paper actually seemed to have better features than the iPhone but in reality none of them really worked worth a shit whereas the ones on the iPhone did. Technically you could surf the web but the experience was beyond painful. By the time they got devices on the market that were competitive it was already too late. Their brand, low cost manufacturing, reliable hardware and other advantages were not enough.
They just fucked up royally on the software-front. Which is the only point I was trying to make.
Yes they did screw up on software. Bad. But that wasn't the only mistake Nokia made. Some Chinese companies taking over the brand isn't going to bring Nokia back from the dead. They have no competitive advantage.
The Lumia phones are still great devices from a design and hardware point of view. Unique even.
I'm sure they are excellent devices but what unique value do they provide that people will actually preferentially pay for? What feature do they have that nobody else has, nobody can copy and that large numbers of people are going to line up to pay cash money for? Maybe they can find a niche but hardware innovations in phones aren't coming so fast these days. Minor incremental and easily copied innovations aren't going to get the job done and aren't strategically defensible.
Let's use Apple for an example. Apple's hardware is generally acknowledged to be upper tier. It might not always be the very best or latest but it's always right up there. But if you put Android on an iPhone, nobody would have any reason to pay a premium for it and customers would have a hard time justifying buying it over any number of other competing Android devices. What makes the iPhone different is the software. The only place you can get iOS is on an iPhone. THAT is why people buy them and pay a premium for them. Without iOS, Apple has to compete on price and distribution and there can really only be one winner in that game. (it's currently Samsung) Apple knows they need good hardware but they also know that they can't reliably deliver hardware that isn't available to or readily copied by their competitors. Trying to differentiate on hardware alone is doomed to failure.
The software and cost advantage could come from "Just run stock Android and focus on the fucking hardware" (tm) instead of blowing tons of cash on custom skins nobody really wants and which hugely complicate software updates.
I think you misunderstand the economics at work here. The software costs on these are comparatively minor. Even if they run bone stock Android that doesn't mean they will have a meaningful cost advantage. Android device makers (mostly) don't care much about updates anyway so it's a non-cost to them. The cost of developing a skin and a few proprietary bits is tiny compared with the cost of developing, making, distributing and selling the hardware. And if they do go stock Android, what prevents another company from copying whatever hardware innovations they might come up with? Samsung basically cloned some of Apple's devices and largely got away with it and Apple has bottomless cash to hire flesh eating lawyers.
While it's not impossible I just don't see a situation where this new Nokia is anything other than another Me Too player with Me Too products in an already crowded market. They're trying to revive a tarnished brand that nobody really cares about anymore without the authenticity that made the brand successful in the first place.
The thing that Nokia should have done more than a decade ago. Build their great hardware and run Android on it.
And profit how exactly? There are companies that make darn good hardware for the Android platform but make basically zero profit or less. Only Samsung has managed to make any meaningful profit on Android. What does Nokia bring to the party that will displace Samsung? A nice piece of hardware alone won't be enough. They either need software to differentiate their product or they need a cost advantage or a distribution advantage. I can't really see any of those being likely.
That strategy worked great for Lance Armstrong
Yes it did. For a long time. It probably would have continued to work if Lance hadn't been such a dick to so many people. Lots of other people from his era got caught doping and few of them were punished anywhere near as hard. Lance got greedy and arrogant and seemed to think he could never get caught.
Anyway he was tested and he tested clean. All that means is that there was no evidence of the drug in his system at the time he was tested. It doesn't mean he wasn't using some PED that they weren't testing for or something the didn't have a test for or that had been flushed from his system prior to the test. Basically doping controls mostly catch the athletes who don't know what they are doing or who get sloppy or just unlucky.
Aren't they dealing with the most urgent/critical cases when they are on call?
Not necessarily. Being on call just means you are available for cases that come in. It doesn't necessarily mean a given patient's case will be more serious than normal. Probably a higher percentage of cases are of the urgent/severe type but not all of them. Frequently on-call is just for monitoring in case an issue crops up, managing staff or to be available just in case something urgent crops up.
It's kind of like holding the off hours pager when you do IT support. Most of the stuff you'll deal with is fairly routine stuff that just as easily could have popped up during the day. Sometimes it's of the more severe variety.
Apple is "fairly valued", it's only in terms about what people know about Apple today - it does not take into account the imminent growth on many fronts along with new products to launch in upcoming years.
ALL stock prices include expectations about future prospects of the company. It absolutely does take into account expectations regarding growth and new products. If you believe in some form of the efficient market hypothesis (and you should) then you would understand this.
The stock price is much lower than it would be if people looked at the stock rationally.
Because the market doesn't agree with your assessment it isn't rational? While it's conceivable you are right it's mighty presumptuous of you to presume that most other investors in Apple is being irrationally pessimistic. Markets are pretty smart and the number of people who can outperform them is pretty small. Unless you have a track record like Warren Buffet you might consider taking a more humble approach. Just because you think it should be worth more doesn't mean you are right.
How many BEFORE Jobs died? Just one. Amazing and highly performant products take time.
Come again? Hit NEW products released under Jobs after he returned to the company include: iMac, iPod, iPhone, iPad, iTunes. Since Jobs died: none. Now I'm willing to give them some time. Apple historically has introduces 1-2 big hit products per decade. But their last big one was the iPad which was introduced 6 years ago. Aside from a few minor products (Apple Watch, etc) Apple hasn't released anything since major Jobs died aside from some solid but incremental improvements to existing products. Now obviously they've got some stuff in development but that guarantees nothing. Apple has had major flops before and it's certainly possible they'll have another one at some point.
But there's a lot of argument to be made that Amazon has reached a point of saturation also and will not have nearly so rapid growth going forward.
Possible but you aren't presenting any actual evidence to back you up. Amazon's growth rate hasn't slowed at all as of the end of 2015. To argue that Amazon's growth prospects are diminishing you need to actually back that up with something other than wishful thinking.
The only reason the Amazon stock is so high right now is because of services but Apple has a MORE compelling services growth picture than even Amazon.
Not seeing the evidence to back you up here either and I'm watching both companies rather closely. Apple isn't really in web services much - not like Amazon is. Apple could be but so far they haven't gone after that market. Both are in media and both are doing rather well.
And that's just services, never mind many other physical products Apple makes that are doing very well, unlike the Fire...
I think you misunderstand the purpose of the Kindle devices including the Fire line. Amazon makes their money from selling ebooks and other content. They basically give the devices away at cost. Like Google they don't make their money by selling devices. It's almost the exact opposite model from Apple which uses content to drive device sales. Neither is a bad model but you can't evaluate them as if they are the same thing. Both are tech companies whose core competency is software but their business models couldn't be more different.
Which Royal Dutch Shell are you talking about? I'm looking at quote.yahoo.com, RDS-B, and it says the yield is 3.76.
RDS.A and RDS.B are the same company. The difference is one stock is denominated in Euros and the other in Pounds Sterling. Otherwise they are the same. Current dividend yield is close to identical for either. Currently hovering at around 7.4% and has been bouncing between 7-8% for a while now.
Furthermore, the stock has gone between $36-$64 in 52 weeks (rounded), as opposed to Apple $90-$133.. So RDS had a much bigger percentage swing in a year..
That's a function of the swings in the price of oil recently. There currently is a surplus of oil on the market so unit price of oil is down and thus so are energy stocks. The price of oil will head back up eventually and so will the stocks along with it. Frankly now is a pretty good time to buy oil stocks like RDS and XOM. Those companies aren't going out of business, the stock price is low but the company fundamentals are solid and unchanged, the companies are still hugely profitable and the dividend yields are outstanding.