And its sucking up all the spending and investment dollars everywhere. Can you guess who it is?
So much attention has been on the banks and all things finance, so we are blind to how Apple is sucking the lifeblood and dollars from everywhere. Remember when being an Apple supplier meant untold riches? Now it is like being a partner with Microsoft, facing increased volumes but significant margin contraction and poor earnings. Remember when a carrier would up revenue and earnings guidance when getting the iPhone? Today, Sprint said they sold millions of iPhones and took a huge loss. That’s right, record new clients and record losses.
As far as investment dollars are concerned, adding 3 or 4 billion each and every market day is normal. It is its own POMO but just to one stock. And the analysts tell us that a a trillion dollar market value would be normal. Apple TV with hand gestures replacing a remote control? Is that worth $70 billion in three months? It is clearly an Apple world.
Is this sour grapes? Maybe just a teeny, weeny bit. Rather, I see a real problem of an ever-expanding market based on an endless closed loop of liquidity and one stock sucking in all the free cash.
FLAME ON
If you enjoy the content at iBankCoin, please follow us on Twitter
AAPL is a monster. They seem to be sucking all the oxygen out of the tech room.
Nice to hear this voiced. Completely agree, maybe you saying it will get people to take notice. Let us not forget they don’t actually make things people need, just want.
Scott, this is one time I unequivocally agree with everything you’re saying.
It bothers me as a human being that the largest company on the planet is a toy manufacturer. They are adult toys that are built better than any others out there, they help you accomplish more things and make look cool doing it, but they are toys none the less.
It also bothers me that analysts who were just winging it trying to make a name for themselves by saying AAPL to $500, are probably going to be proven correct and can live happily ever after on that one “ballsy call.” But that is the nature of the industry.
If I had the balls I’d put on some kind of long term pairs trade with them and a large no growth tech company like MSFT or CSCO. But where’s the risk/reward? If they gun the market to all time highs, AAPL will be 600+
But when it does fall, there is SO much baked into that cake.
I’m starting it today: short AAPL, long MSFT
Been thinking about that one for a while, and it looks too appealing on a long term basis to pass up. I’m a bit ballsy, though.
scott, i think you should also highlight market saturation for AAPL… if apple TV doesn’t pan out, they don’t have much more growth in ipod/iphone/ipad markets, IMO. RIMM started to die when my mom got a blackberry. She just got an Iphone. Apple TV must fail though.
Flame nothing.
Agreed as well.
A trillion dollar market value is not “normal”.
Neither is $70 billion in 3 months.
Apple is a fine company. But they are not Standard Oil circa 1900. (nor are we in that “type” of economic and legal enivronment.)
And what TJWP said!
There was no high volume buy surge marking top before 2010 flash crash,or 2011 summer crash. Why do so many expect one this time?
I’m seeing a low volume “good news” top in progress. Just like we’ve had prior to every major sell off for years:
Back to back good tech news/ Slowing rate of ascent/ Zero volume, etc.
Same things at every top! But, it somehow catches people by surprise every time.
AAPL shoving a 80 dollar roku box into the back of a TV , and then upselling it by 300% , is NOT the birth of the next bull market.
You’ve got to give Big Brother aka Apple credit – they’ve turned us into the drooling monitored drones of their 1984 commercial and have us happily paying for the privilege.
With all this bashing I do have to give props where it is due.
They have gotten away with things that no company should be able to and are the envy of all because of it.
Does anyone remember those TV advertisements from a few years back where they just put their new monitor in front of a white background and rotated it? No company should be able to get away with that, let along leave people salivating over the prospect of forking over hard earned money for overpriced gadgets. But they did and it was one of the greatest TV campaigns ever because of it.
hmmm, that wasn’t suppose to be a reply…
A Game
I see a whole bunch of you that have no clue on what makes the company and its engine hum at max power for years now. Toys? Gadgets? How about changing the mobile landscape! Go long MSFT and short AAPL??? MSFT is growing its top line @ LESS THAN 5%!!! AAPL is growing at least 50% this year and then only to 30%. HOw many more years are you gonna use your windoze box and think its acceptable? The iPad is like a bowling ball flying down the lane at all things PC related sitting there in a row. Toys are not what makes a college student or hedge fund manager DROOL over the iPhone 5 rumors. TV??? I hate my cable company and its sad menus and boxes that are forced on me. How about PE of less than 10 minus cash combined with explosive worldwide growth.
PS Europe sales were up 55% last quarter.
I get what you’re saying and the valuation is “cheap.” But, BUT, how much of that 50% growth is baked into the cake? It’s about risk/reward. Buy, sell or hold? I know they have changed the mobile landscape, but how many companies change the world multiple times over? Maybe it’s different this time, but I will never bet on a company doing incredibly innovative things every time. I won’t short it because the risk/reward isn’t there, but I certainly wouldn’t be caught dead owning it at these levels.
How long will people use “windoze?” I’m willing to bet 99% of consumers cannot tell the difference between Apple and windows 7. Problem is, consumers is all Apple has. They aren’t running networks. They aren’t powering businesses (that one is debatable). They aren’t creating infrastructure. They service the demands of the consumer. They do it better than anyone, but that is all they do.
Maybe they will knock another one out of the park with TV. The share price is expecting it, so they better not disappoint.
Leftcoast, you sound like a certain brother of mine back in 2000 when i was telling him to buy AAPL (or in his words, crAAPL). I don’t know why you suit and tie guys can’t see it.
There will come a day when AAPL doesn’t consistently kill it. That day is not near.
And they certainly don’t make “toys.”
if the clam wanted to start a ripping stockmarket bull run? the endless bid in the ONE stock every dentist on earth owns could do it.
Dentists?
The tendency would be to assume wealth and success as a shareholder. But as every shareholder is feeling the same sensation it becomes an inflation. No way is everybody going to realize the price they have counted as there own wealth. Artificial liquidity in a way.
love this post
Regarding need vs. want, somewhere I read a post suggesting that Facebook is a want compared to a need. That is, FB is a vice or addiction, as opposed to Google offering a service that people need (search).
But, as someone else might say “price pays”.
No hate here towards Apple and their success, but the need vs. want point is something to consider.
The homeless in my town outside of the food shelter have iPhones. It is more than a want. No car, no home, no shoes, but an iPhone 4 in hand.
AAPL is way above any fibo support and is flying in Air. Soros Reflexology will have this thing crashing and burning..Gadget company that every Fund Owns in large amounts is just scary.
“AAPL is way above any fibo support ”
But you’ve been saying that for 200 points already. Even if it eventually happens (50 points higher from here? 100?), you were still wrong.
bleier, I appreciate your dedication to print the truth, but u are far too negative like your 1170spx call, u have to go with the flow&trade unbiased
My 1170 call was breached by 8 points before beginning this rally right here…
AAPL is over bot at YR2
Don’t be stupid and let it run on you, use resistance to determine where it will pull back.