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It was bound to happen sooner or later

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  It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 16:12 -0400
    Re: It was bound to happen sooner or later Tomas <tgif9fri@numo.net> - 2015-04-10 16:15 -0400
      Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 16:29 -0400
        Re: It was bound to happen sooner or later Tomas <tgif9fri@numo.net> - 2015-04-10 17:20 -0400
    Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-10 13:33 -0700
    Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-10 22:07 +0000
      Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-10 19:20 -0400
        Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 00:19 +0000
          Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-11 09:08 -0400
            Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 14:45 +0000
              Re: It was bound to happen sooner or later DFS <nospam@dfs.com> - 2015-04-11 12:21 -0400
                Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 16:58 +0000
                  Re: It was bound to happen sooner or later DFS <nospam@dfs.com> - 2015-04-11 22:00 -0400
              Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 09:43 -0700
                Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 17:17 +0000
                  Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 17:20 +0000
                  Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 11:58 -0700
                    Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 20:02 +0000
                      Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-11 13:56 -0700
                        Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-11 21:48 +0000
              Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-13 14:01 -0400
                Re: It was bound to happen sooner or later Snit <usenet@gallopinginsanity.com> - 2015-04-13 11:21 -0700
                Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 19:24 +0000
                  Re: It was bound to happen sooner or later "Ezekiel" <zeke@nosuchemail.com> - 2015-04-13 16:04 -0400
                    Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 20:35 +0000
                      Re: It was bound to happen sooner or later Steve Carroll <fretwizzer@gmail.com> - 2015-04-13 14:13 -0700
                        Re: It was bound to happen sooner or later owl <owl@rooftop.invalid> - 2015-04-13 21:52 +0000
                How many barrels of oil will the stock produce ? Jeff-Relf.Me <@.> - 2015-04-13 23:42 -0700
                  Re: How many barrels of oil will the stock produce ? "Ezekiel" <zeke@nosuchemail.com> - 2015-04-14 13:37 -0400
                    How many barrels of oil will the stock produce ? Jeff-Relf.Me <@.> - 2015-04-14 10:55 -0700
                      Re: How many barrels of oil will the stock produce ? "Ezekiel" <zeke@nosuchemail.com> - 2015-04-14 15:20 -0400

Page 2 of 2 — ← Prev page 1 [2]

#289446

"owl" <owl@rooftop.invalid> wrote in message 
news:jgnvmb83.gkjd@rooftop.invalid...
> Ezekiel <zeke@nosuchemail.com> wrote:
>
>> "owl" <owl@rooftop.invalid> wrote in message
>> news:bghvur80.ra0@rooftop.invalid...
>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>
>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>> news:gbvjdu03.pa3f@rooftop.invalid...
>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>> Apple is worth twice as much as Google.
>>>>>
>>>>>> Or Google is worth 1/2 as much as Apple if you prefer.
>>>>>
>>>>>>     AAPL = $740.33B
>>>>>>     GOOG = $367.59B
>>>>>
>>>>>> I know many of you are confused because of "share price."  But don't
>>>>>> be.
>>>>>> It's market-capitalization that determines what a company is worth. 
>>>>>> Not
>>>>>> the
>>>>>> share price.
>>>>>
>>>>>> Don't be like this dimwit below.
>>>>>
>>>>>> -- 
>>>>>> "Share price is a measure of market confidence based on current
>>>>>> performance.
>>>>>> The market is apparently twice as confident of ($600) Google as it is
>>>>>> of
>>>>>> ($320) Apple, and 20 times more confident than it is of ($28)
>>>>>> Microsoft.
>>>>>> So
>>>>>> what Google is doing today is apparently better than what others are
>>>>>> doing."
>>>>>
>>>>>> Homer the "advocate" lecturing others on another simple concept he
>>>>>> completely fails to understand
>>>>>
>>>>> Yeah, but market cap is basically a popularity contest.
>>>
>>>> To a very small extent. There's always the "now company people want to
>>>> see
>>>> in the portfolio" thing but it's primarily based on fundamentals and
>>>> expected future earnings.
>>>
>>>
>>>>> Apple doesn't have
>>>>> all that money, and they don't get money every time a share of Apple
>>>>> stock
>>>>> is sold at a higher price.  Apple got paid one time - the day the 
>>>>> stock
>>>>> was
>>>>> issued.
>>>
>>>> Yes and no. When a company has their IPO they don't release all the
>>>> shares.
>>>> It's called the "float" and nearly every company owns and holds shares 
>>>> in
>>>> their own company. When you hear a company is spending billions on a
>>>> "stock
>>>> buyback" then they're buying more of their own shares. Companies use 
>>>> the
>>>> shares they own for bonuses, etc but they'll also sell some shares to
>>>> raise
>>>> capital.
>>>
>>>
>>>>> 2014 Liabilities & Shareholders' Equity:
>>>>> Apple: 231.84B
>>>>> Google: 131.13B
>>>>> Microsoft: 172.38B
>>>>>
>>>>> http://www.marketwatch.com/investing/stock/aapl/financials/balance-sheet
>>>>> http://www.marketwatch.com/investing/stock/goog/financials/balance-sheet
>>>>> http://www.marketwatch.com/investing/stock/msft/financials/balance-sheet
>>>>>
>>>
>>>> This is an interesting accounting trick. You see companies with insane
>>>> amounts of money in the bank yet these companies issue debt (ie - 
>>>> borrow
>>>> money) to raise capital.
>>>
>>>> The reason behind this is that Apple/Microsoft/Google have the highest
>>>> possible bond ratings. So they can borrow money at a low interest rate
>>>> and
>>>> then deduct the interest from their taxes.
>>>
>>>> Most/much/shitloads of the cash they have is overseas. So if they were 
>>>> to
>>>> bring that cash back into the US they would need to pay US taxes on the
>>>> money. So it's cheaper to borrow money (at low rates) than it is to 
>>>> bring
>>>> in
>>>> money from foreign subsidiaries.
>>>
>>> Actually I grabbed the wrong line.
>>>
>>> Total Equity 2014:
>>> Apple: 111.55B
>>> Google: 104.5B
>>> Microsoft: 89.78B
>>>
>>> So they are really *much* closer than market cap would indicate.
>>> I mean, really, if Apple's share price fell to $1 tomorrow, based on
>>> some wild news that made everybody suddenly hate the company and dump
>>> their stock, the company would still actually be in the black to the
>>> tune of 111.55 billion
>
>> Having $111 billion in the bank isn't a bad thing. According to their 
>> latest
>> SEC filing it's now up to $178 Billion.
>
>>     "Apple has mind-boggling $178 billion in cash to spend"
>>     (CNN-Money)
>
>
>
>>> and the shareholders could force the board
>>> to give them some moolah.
>
>> Here's where it gets tricky. For example, Google founders did a 
>> power-play
>> and made it so that ordinary share-holders have no voting rights. On top 
>> of
>> that, their special "class-B shares" (that don't trade on the market) get 
>> 10
>> votes/share whereas ordinary class-A shares get only 1 vote per share.
>
>> The bottom line is that even if every single Google shareholder in the 
>> world
>> agreed on something - they can't force the company/board to do squat.
>
>> <quote>
>> I believe this stock split is largely being done so that Sergey Brin and
>> Larry Page can maintain voting control over everyone else.
>
>> However if they don't execute well they can't be "forced" to change by
>> everyone else.
>
>> Currently everyone except Brin, Page, Eric Schmidt, Google's ex-CEO and
>> Executive Chairman, and a few other people own Class A shares. Class A
>> shares get one vote for each share.
>
>> Class B shares are largely owned by Brin, Page and Schmidt and they get 
>> 10
>> votes per share. In total there were 56,167,343 Class B shares 
>> outstanding
>> on January 30, 2014.
>
>> Class C shares will be given to the Class A and B shareholders but 
>> receive
>> no votes on stockholder resolutions. Their trading symbol will be the
>> historical GOOG after the split. These are the shares that the company 
>> will
>> probably issue going forward for acquisitions or stock awards.
>
>
>> This means that Brin and Sergey have 468 million votes compared to the 
>> 280
>> million Class A shareholders, essentially complete control of the company 
>> as
>> they have just over 55% of the total votes. Maybe the Board could exert
>> enough pressure on either Brin or Page to step down if they thought it 
>> was
>> being taken in such a wrong direction that it warranted action but 
>> otherwise
>> the founders have complete control.
>> </quote>
>> http://www.forbes.com/sites/chuckjones/2014/04/02/google-stock-split-in-larry-and-sergey-we-trust/
>
>
>
>>> Regardless of whatever is happening trade-wise on the market, a stock
>>> represents an ownership share of the company, and if the company is
>>> strong financially, that share has value separate from its market value.
>>> Likewise, whatever inflated price a stock might be selling for has no
>>> real relation to the "value" of a company.
>
>> A companies assets (like $178 billion in the bank) gets factored into the
>> companies valuation. So in Apple's case, they're a $562 billion dollar
>> company with $178 billion in the bank.
>
> All that really means though is, "this is how we're going to do the math."
> A company is truly only worth its net worth: assets - liabilities.  The
> stock market is just respectable a means of gambling and has no relevance
> the value of a company.  If I decide to buy Apple one day, there's no
> way I'm paying $740 billion for a company....

True, there's no way you'd ever pay $740 billion for Apple. If 
(hypothetically) this were to happen then you'd be paying about $925 
Billion.

Acquisitions happen all of the time. The company being bought out is usually 
paid about a 25% premium. Example from just last week:

<quote>
Mylan, one of the big makers of generic drugs, made public on Wednesday an 
unsolicited offer to acquire Perrigo for about $29 billion in a deal that 
would extensively expand its range of product offerings.

Under the offer, announced on Wednesday, Mylan would pay $205 a share in 
cash and stock for Perrigo, a 25 percent premium over Perrigo's stock price 
last Friday. Mylan did not specify what the split of cash and stock would 
be.
</quote>



>  that has a net worth of $178 billion.

The "net worth" or what you've called book-value is going to be very low for 
any company. What's the book value for Google ($367B) ... they own a bunch 
of used servers? What's the book value for Visa ($161B) - they don't own 
much of anything. Or a bank like Wells Fargo ($281B) where they mainly hold 
money that doesn't even belong to them.

The way to look at these companies is to view them as a money-making 
machine. If your neighbor offerred to sell you a "machine" that legally 
produces $100k/year in cash then what would you be willing to pay for the 
machine? Would you tell him to take a hike because there's only $3000 worth 
of parts in this machine?

Not that this is sustainable, but I'll use Apple's last quarterly earnings 
as an example:

    <quote>
    Apple just posted the best quarter in corporate history

    Apple (AAPL) sold 74.5 million iPhones in the last three months.
    That helped Apple's profit soar more than 37% to $18 billion.
    </quote>
    http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/

It's a money-making-machine that's currently generating a profit of $8.25 
million dollars an hour, 24x7 around the clock. *That* is what gives them 
their market cap.

-- 
"Fact is in order to "steal" something not only do you gain access to it 
illegally, you deprive the original owner of their ownership"

Phil Da Lick! - The nonsense you get when "advocates" make up their own 
"facts."
<u5adneKxjevjjYDMnZ2dnUVZ8iednZ2d@brightview.co.uk>

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#289451

On 4/13/15, 11:01 AM, in article mgh079$4d6$1@dont-email.me, "Ezekiel"
<zeke@nosuchemail.com> wrote:

> Not that this is sustainable, but I'll use Apple's last quarterly earnings
> as an example:
> 
>     <quote>
>     Apple just posted the best quarter in corporate history
> 
>     Apple (AAPL) sold 74.5 million iPhones in the last three months.
>     That helped Apple's profit soar more than 37% to $18 billion.
>     </quote>
>     http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/

I have been saying for quite a few years, since well before Jobs died, that
Apple's fortunes will someday come to an end. I keep predicting it and being
wrong.

One of these days, though, I will be right about Apple running into
significant troubles. :)


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#289466

Ezekiel <zeke@nosuchemail.com> wrote:
> "owl" <owl@rooftop.invalid> wrote in message 
> news:jgnvmb83.gkjd@rooftop.invalid...
>> Ezekiel <zeke@nosuchemail.com> wrote:
>>
>>> "owl" <owl@rooftop.invalid> wrote in message
>>> news:bghvur80.ra0@rooftop.invalid...
>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>
>>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>>> news:gbvjdu03.pa3f@rooftop.invalid...
>>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>>> Apple is worth twice as much as Google.
>>>>>>
>>>>>>> Or Google is worth 1/2 as much as Apple if you prefer.
>>>>>>
>>>>>>>     AAPL = $740.33B
>>>>>>>     GOOG = $367.59B
>>>>>>
>>>>>>> I know many of you are confused because of "share price."  But don't
>>>>>>> be.
>>>>>>> It's market-capitalization that determines what a company is worth. 
>>>>>>> Not
>>>>>>> the
>>>>>>> share price.
>>>>>>
>>>>>>> Don't be like this dimwit below.
>>>>>>
>>>>>>> -- 
>>>>>>> "Share price is a measure of market confidence based on current
>>>>>>> performance.
>>>>>>> The market is apparently twice as confident of ($600) Google as it is
>>>>>>> of
>>>>>>> ($320) Apple, and 20 times more confident than it is of ($28)
>>>>>>> Microsoft.
>>>>>>> So
>>>>>>> what Google is doing today is apparently better than what others are
>>>>>>> doing."
>>>>>>
>>>>>>> Homer the "advocate" lecturing others on another simple concept he
>>>>>>> completely fails to understand
>>>>>>
>>>>>> Yeah, but market cap is basically a popularity contest.
>>>>
>>>>> To a very small extent. There's always the "now company people want to
>>>>> see
>>>>> in the portfolio" thing but it's primarily based on fundamentals and
>>>>> expected future earnings.
>>>>
>>>>
>>>>>> Apple doesn't have
>>>>>> all that money, and they don't get money every time a share of Apple
>>>>>> stock
>>>>>> is sold at a higher price.  Apple got paid one time - the day the 
>>>>>> stock
>>>>>> was
>>>>>> issued.
>>>>
>>>>> Yes and no. When a company has their IPO they don't release all the
>>>>> shares.
>>>>> It's called the "float" and nearly every company owns and holds shares 
>>>>> in
>>>>> their own company. When you hear a company is spending billions on a
>>>>> "stock
>>>>> buyback" then they're buying more of their own shares. Companies use 
>>>>> the
>>>>> shares they own for bonuses, etc but they'll also sell some shares to
>>>>> raise
>>>>> capital.
>>>>
>>>>
>>>>>> 2014 Liabilities & Shareholders' Equity:
>>>>>> Apple: 231.84B
>>>>>> Google: 131.13B
>>>>>> Microsoft: 172.38B
>>>>>>
>>>>>> http://www.marketwatch.com/investing/stock/aapl/financials/balance-sheet
>>>>>> http://www.marketwatch.com/investing/stock/goog/financials/balance-sheet
>>>>>> http://www.marketwatch.com/investing/stock/msft/financials/balance-sheet
>>>>>>
>>>>
>>>>> This is an interesting accounting trick. You see companies with insane
>>>>> amounts of money in the bank yet these companies issue debt (ie - 
>>>>> borrow
>>>>> money) to raise capital.
>>>>
>>>>> The reason behind this is that Apple/Microsoft/Google have the highest
>>>>> possible bond ratings. So they can borrow money at a low interest rate
>>>>> and
>>>>> then deduct the interest from their taxes.
>>>>
>>>>> Most/much/shitloads of the cash they have is overseas. So if they were 
>>>>> to
>>>>> bring that cash back into the US they would need to pay US taxes on the
>>>>> money. So it's cheaper to borrow money (at low rates) than it is to 
>>>>> bring
>>>>> in
>>>>> money from foreign subsidiaries.
>>>>
>>>> Actually I grabbed the wrong line.
>>>>
>>>> Total Equity 2014:
>>>> Apple: 111.55B
>>>> Google: 104.5B
>>>> Microsoft: 89.78B
>>>>
>>>> So they are really *much* closer than market cap would indicate.
>>>> I mean, really, if Apple's share price fell to $1 tomorrow, based on
>>>> some wild news that made everybody suddenly hate the company and dump
>>>> their stock, the company would still actually be in the black to the
>>>> tune of 111.55 billion
>>
>>> Having $111 billion in the bank isn't a bad thing. According to their 
>>> latest
>>> SEC filing it's now up to $178 Billion.
>>
>>>     "Apple has mind-boggling $178 billion in cash to spend"
>>>     (CNN-Money)
>>
>>
>>
>>>> and the shareholders could force the board
>>>> to give them some moolah.
>>
>>> Here's where it gets tricky. For example, Google founders did a 
>>> power-play
>>> and made it so that ordinary share-holders have no voting rights. On top 
>>> of
>>> that, their special "class-B shares" (that don't trade on the market) get 
>>> 10
>>> votes/share whereas ordinary class-A shares get only 1 vote per share.
>>
>>> The bottom line is that even if every single Google shareholder in the 
>>> world
>>> agreed on something - they can't force the company/board to do squat.
>>
>>> <quote>
>>> I believe this stock split is largely being done so that Sergey Brin and
>>> Larry Page can maintain voting control over everyone else.
>>
>>> However if they don't execute well they can't be "forced" to change by
>>> everyone else.
>>
>>> Currently everyone except Brin, Page, Eric Schmidt, Google's ex-CEO and
>>> Executive Chairman, and a few other people own Class A shares. Class A
>>> shares get one vote for each share.
>>
>>> Class B shares are largely owned by Brin, Page and Schmidt and they get 
>>> 10
>>> votes per share. In total there were 56,167,343 Class B shares 
>>> outstanding
>>> on January 30, 2014.
>>
>>> Class C shares will be given to the Class A and B shareholders but 
>>> receive
>>> no votes on stockholder resolutions. Their trading symbol will be the
>>> historical GOOG after the split. These are the shares that the company 
>>> will
>>> probably issue going forward for acquisitions or stock awards.
>>
>>
>>> This means that Brin and Sergey have 468 million votes compared to the 
>>> 280
>>> million Class A shareholders, essentially complete control of the company 
>>> as
>>> they have just over 55% of the total votes. Maybe the Board could exert
>>> enough pressure on either Brin or Page to step down if they thought it 
>>> was
>>> being taken in such a wrong direction that it warranted action but 
>>> otherwise
>>> the founders have complete control.
>>> </quote>
>>> http://www.forbes.com/sites/chuckjones/2014/04/02/google-stock-split-in-larry-and-sergey-we-trust/
>>
>>
>>
>>>> Regardless of whatever is happening trade-wise on the market, a stock
>>>> represents an ownership share of the company, and if the company is
>>>> strong financially, that share has value separate from its market value.
>>>> Likewise, whatever inflated price a stock might be selling for has no
>>>> real relation to the "value" of a company.
>>
>>> A companies assets (like $178 billion in the bank) gets factored into the
>>> companies valuation. So in Apple's case, they're a $562 billion dollar
>>> company with $178 billion in the bank.
>>
>> All that really means though is, "this is how we're going to do the math."
>> A company is truly only worth its net worth: assets - liabilities.  The
>> stock market is just respectable a means of gambling and has no relevance
>> the value of a company.  If I decide to buy Apple one day, there's no
>> way I'm paying $740 billion for a company....

> True, there's no way you'd ever pay $740 billion for Apple. If 
> (hypothetically) this were to happen then you'd be paying about $925 
> Billion.

> Acquisitions happen all of the time. The company being bought out is usually 
> paid about a 25% premium. Example from just last week:

> <quote>
> Mylan, one of the big makers of generic drugs, made public on Wednesday an 
> unsolicited offer to acquire Perrigo for about $29 billion in a deal that 
> would extensively expand its range of product offerings.

> Under the offer, announced on Wednesday, Mylan would pay $205 a share in 
> cash and stock for Perrigo, a 25 percent premium over Perrigo's stock price 
> last Friday. Mylan did not specify what the split of cash and stock would 
> be.
> </quote>



>>  that has a net worth of $178 billion.

> The "net worth" or what you've called book-value is going to be very low for 
> any company. What's the book value for Google ($367B) ... they own a bunch 
> of used servers? What's the book value for Visa ($161B) - they don't own 
> much of anything. Or a bank like Wells Fargo ($281B) where they mainly hold 
> money that doesn't even belong to them.

> The way to look at these companies is to view them as a money-making 
> machine. If your neighbor offerred to sell you a "machine" that legally 
> produces $100k/year in cash then what would you be willing to pay for the 
> machine? Would you tell him to take a hike because there's only $3000 worth 
> of parts in this machine?

> Not that this is sustainable, but I'll use Apple's last quarterly earnings 
> as an example:

>     <quote>
>     Apple just posted the best quarter in corporate history

>     Apple (AAPL) sold 74.5 million iPhones in the last three months.
>     That helped Apple's profit soar more than 37% to $18 billion.
>     </quote>
>     http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/

> It's a money-making-machine that's currently generating a profit of $8.25 
> million dollars an hour, 24x7 around the clock. *That* is what gives them 
> their market cap.

That doesn't change the fact that "market cap" has no real meaning.
It does not represent any tangible asset that the company or its
investors possess.

In other words, Apple's $740 billion market cap might as well be thought
of as "the missing $740 billion."

So where is this missing $740 billion?

Does Apple have this $740 billion?  No.

Do Apple's investors have this $740 billion?  No.  They *spent* money
for their shares.  They now have pieces of paper representing fractional
ownership of Apple's equity (which is nowhere near $740 billion) instead
of the actual money they used to have.

Who does have this missing $740 billion then?

Some of it is in the hands of the people (AKA the Smiling Ones) who sold
the current Apple stockholders their pieces of paper.

The rest of it doesn't even exist at all, because market cap is just
a price tag.  And a price tag is not the same thing as money.

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#289471

"owl" <owl@rooftop.invalid> wrote in message 
news:vnhguf93.kjhg@rooftop.invalid...
> Ezekiel <zeke@nosuchemail.com> wrote:
>> "owl" <owl@rooftop.invalid> wrote in message
>> news:jgnvmb83.gkjd@rooftop.invalid...
>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>
>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>> news:bghvur80.ra0@rooftop.invalid...
>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>
>>>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>>>> news:gbvjdu03.pa3f@rooftop.invalid...
>>>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>>>> Apple is worth twice as much as Google.
>>>>>>>
>>>>>>>> Or Google is worth 1/2 as much as Apple if you prefer.
>>>>>>>
>>>>>>>>     AAPL = $740.33B
>>>>>>>>     GOOG = $367.59B
>>>>>>>
>>>>>>>> I know many of you are confused because of "share price."  But 
>>>>>>>> don't
>>>>>>>> be.
>>>>>>>> It's market-capitalization that determines what a company is worth.
>>>>>>>> Not
>>>>>>>> the
>>>>>>>> share price.
>>>>>>>
>>>>>>>> Don't be like this dimwit below.
>>>>>>>
>>>>>>>> -- 
>>>>>>>> "Share price is a measure of market confidence based on current
>>>>>>>> performance.
>>>>>>>> The market is apparently twice as confident of ($600) Google as it 
>>>>>>>> is
>>>>>>>> of
>>>>>>>> ($320) Apple, and 20 times more confident than it is of ($28)
>>>>>>>> Microsoft.
>>>>>>>> So
>>>>>>>> what Google is doing today is apparently better than what others 
>>>>>>>> are
>>>>>>>> doing."
>>>>>>>
>>>>>>>> Homer the "advocate" lecturing others on another simple concept he
>>>>>>>> completely fails to understand
>>>>>>>
>>>>>>> Yeah, but market cap is basically a popularity contest.
>>>>>
>>>>>> To a very small extent. There's always the "now company people want 
>>>>>> to
>>>>>> see
>>>>>> in the portfolio" thing but it's primarily based on fundamentals and
>>>>>> expected future earnings.
>>>>>
>>>>>
>>>>>>> Apple doesn't have
>>>>>>> all that money, and they don't get money every time a share of Apple
>>>>>>> stock
>>>>>>> is sold at a higher price.  Apple got paid one time - the day the
>>>>>>> stock
>>>>>>> was
>>>>>>> issued.
>>>>>
>>>>>> Yes and no. When a company has their IPO they don't release all the
>>>>>> shares.
>>>>>> It's called the "float" and nearly every company owns and holds 
>>>>>> shares
>>>>>> in
>>>>>> their own company. When you hear a company is spending billions on a
>>>>>> "stock
>>>>>> buyback" then they're buying more of their own shares. Companies use
>>>>>> the
>>>>>> shares they own for bonuses, etc but they'll also sell some shares to
>>>>>> raise
>>>>>> capital.
>>>>>
>>>>>
>>>>>>> 2014 Liabilities & Shareholders' Equity:
>>>>>>> Apple: 231.84B
>>>>>>> Google: 131.13B
>>>>>>> Microsoft: 172.38B
>>>>>>>
>>>>>>> http://www.marketwatch.com/investing/stock/aapl/financials/balance-sheet
>>>>>>> http://www.marketwatch.com/investing/stock/goog/financials/balance-sheet
>>>>>>> http://www.marketwatch.com/investing/stock/msft/financials/balance-sheet
>>>>>>>
>>>>>
>>>>>> This is an interesting accounting trick. You see companies with 
>>>>>> insane
>>>>>> amounts of money in the bank yet these companies issue debt (ie -
>>>>>> borrow
>>>>>> money) to raise capital.
>>>>>
>>>>>> The reason behind this is that Apple/Microsoft/Google have the 
>>>>>> highest
>>>>>> possible bond ratings. So they can borrow money at a low interest 
>>>>>> rate
>>>>>> and
>>>>>> then deduct the interest from their taxes.
>>>>>
>>>>>> Most/much/shitloads of the cash they have is overseas. So if they 
>>>>>> were
>>>>>> to
>>>>>> bring that cash back into the US they would need to pay US taxes on 
>>>>>> the
>>>>>> money. So it's cheaper to borrow money (at low rates) than it is to
>>>>>> bring
>>>>>> in
>>>>>> money from foreign subsidiaries.
>>>>>
>>>>> Actually I grabbed the wrong line.
>>>>>
>>>>> Total Equity 2014:
>>>>> Apple: 111.55B
>>>>> Google: 104.5B
>>>>> Microsoft: 89.78B
>>>>>
>>>>> So they are really *much* closer than market cap would indicate.
>>>>> I mean, really, if Apple's share price fell to $1 tomorrow, based on
>>>>> some wild news that made everybody suddenly hate the company and dump
>>>>> their stock, the company would still actually be in the black to the
>>>>> tune of 111.55 billion
>>>
>>>> Having $111 billion in the bank isn't a bad thing. According to their
>>>> latest
>>>> SEC filing it's now up to $178 Billion.
>>>
>>>>     "Apple has mind-boggling $178 billion in cash to spend"
>>>>     (CNN-Money)
>>>
>>>
>>>
>>>>> and the shareholders could force the board
>>>>> to give them some moolah.
>>>
>>>> Here's where it gets tricky. For example, Google founders did a
>>>> power-play
>>>> and made it so that ordinary share-holders have no voting rights. On 
>>>> top
>>>> of
>>>> that, their special "class-B shares" (that don't trade on the market) 
>>>> get
>>>> 10
>>>> votes/share whereas ordinary class-A shares get only 1 vote per share.
>>>
>>>> The bottom line is that even if every single Google shareholder in the
>>>> world
>>>> agreed on something - they can't force the company/board to do squat.
>>>
>>>> <quote>
>>>> I believe this stock split is largely being done so that Sergey Brin 
>>>> and
>>>> Larry Page can maintain voting control over everyone else.
>>>
>>>> However if they don't execute well they can't be "forced" to change by
>>>> everyone else.
>>>
>>>> Currently everyone except Brin, Page, Eric Schmidt, Google's ex-CEO and
>>>> Executive Chairman, and a few other people own Class A shares. Class A
>>>> shares get one vote for each share.
>>>
>>>> Class B shares are largely owned by Brin, Page and Schmidt and they get
>>>> 10
>>>> votes per share. In total there were 56,167,343 Class B shares
>>>> outstanding
>>>> on January 30, 2014.
>>>
>>>> Class C shares will be given to the Class A and B shareholders but
>>>> receive
>>>> no votes on stockholder resolutions. Their trading symbol will be the
>>>> historical GOOG after the split. These are the shares that the company
>>>> will
>>>> probably issue going forward for acquisitions or stock awards.
>>>
>>>
>>>> This means that Brin and Sergey have 468 million votes compared to the
>>>> 280
>>>> million Class A shareholders, essentially complete control of the 
>>>> company
>>>> as
>>>> they have just over 55% of the total votes. Maybe the Board could exert
>>>> enough pressure on either Brin or Page to step down if they thought it
>>>> was
>>>> being taken in such a wrong direction that it warranted action but
>>>> otherwise
>>>> the founders have complete control.
>>>> </quote>
>>>> http://www.forbes.com/sites/chuckjones/2014/04/02/google-stock-split-in-larry-and-sergey-we-trust/
>>>
>>>
>>>
>>>>> Regardless of whatever is happening trade-wise on the market, a stock
>>>>> represents an ownership share of the company, and if the company is
>>>>> strong financially, that share has value separate from its market 
>>>>> value.
>>>>> Likewise, whatever inflated price a stock might be selling for has no
>>>>> real relation to the "value" of a company.
>>>
>>>> A companies assets (like $178 billion in the bank) gets factored into 
>>>> the
>>>> companies valuation. So in Apple's case, they're a $562 billion dollar
>>>> company with $178 billion in the bank.
>>>
>>> All that really means though is, "this is how we're going to do the 
>>> math."
>>> A company is truly only worth its net worth: assets - liabilities.  The
>>> stock market is just respectable a means of gambling and has no 
>>> relevance
>>> the value of a company.  If I decide to buy Apple one day, there's no
>>> way I'm paying $740 billion for a company....
>
>> True, there's no way you'd ever pay $740 billion for Apple. If
>> (hypothetically) this were to happen then you'd be paying about $925
>> Billion.
>
>> Acquisitions happen all of the time. The company being bought out is 
>> usually
>> paid about a 25% premium. Example from just last week:
>
>> <quote>
>> Mylan, one of the big makers of generic drugs, made public on Wednesday 
>> an
>> unsolicited offer to acquire Perrigo for about $29 billion in a deal that
>> would extensively expand its range of product offerings.
>
>> Under the offer, announced on Wednesday, Mylan would pay $205 a share in
>> cash and stock for Perrigo, a 25 percent premium over Perrigo's stock 
>> price
>> last Friday. Mylan did not specify what the split of cash and stock would
>> be.
>> </quote>
>
>
>
>>>  that has a net worth of $178 billion.
>
>> The "net worth" or what you've called book-value is going to be very low 
>> for
>> any company. What's the book value for Google ($367B) ... they own a 
>> bunch
>> of used servers? What's the book value for Visa ($161B) - they don't own
>> much of anything. Or a bank like Wells Fargo ($281B) where they mainly 
>> hold
>> money that doesn't even belong to them.
>
>> The way to look at these companies is to view them as a money-making
>> machine. If your neighbor offerred to sell you a "machine" that legally
>> produces $100k/year in cash then what would you be willing to pay for the
>> machine? Would you tell him to take a hike because there's only $3000 
>> worth
>> of parts in this machine?
>
>> Not that this is sustainable, but I'll use Apple's last quarterly 
>> earnings
>> as an example:
>
>>     <quote>
>>     Apple just posted the best quarter in corporate history
>
>>     Apple (AAPL) sold 74.5 million iPhones in the last three months.
>>     That helped Apple's profit soar more than 37% to $18 billion.
>>     </quote>
>>     http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/
>
>> It's a money-making-machine that's currently generating a profit of $8.25
>> million dollars an hour, 24x7 around the clock. *That* is what gives them
>> their market cap.
>
> That doesn't change the fact that "market cap" has no real meaning.
> It does not represent any tangible asset that the company or its
> investors possess.
>
> In other words, Apple's $740 billion market cap might as well be thought
> of as "the missing $740 billion."
>
> So where is this missing $740 billion?
>
> Does Apple have this $740 billion?  No.
>
> Do Apple's investors have this $740 billion?  No.  They *spent* money
> for their shares.  They now have pieces of paper representing fractional
> ownership of Apple's equity (which is nowhere near $740 billion) instead
> of the actual money they used to have.
>
> Who does have this missing $740 billion then?
>
> Some of it is in the hands of the people (AKA the Smiling Ones) who sold
> the current Apple stockholders their pieces of paper.
>
> The rest of it doesn't even exist at all, because market cap is just
> a price tag.  And a price tag is not the same thing as money.
>

Ahhh... Now I see what you're saying.

Sure, market cap doesn't represent any tangible value. It's simply 
share-price multiplied by the number of shares outstanding. It's the 
calculated equity value of a company. There's no actual $740 billion dollars 
anywhere. I certainly agree with that.

It's like when a stock price goes up or down by 10% one day. In Apple's 
case, did an additional $75 billion magically appear or disappear from the 
day before? Yeah - there's no real/actual money anywhere. The market cap is 
just the current value that the investment community puts on a company.

It's basically a way of expressing the total combined value of all the 
company shares. In a perfect world this value would be pretty accurate and 
consistent but in the real world it's not. There are things like the dot-com 
bubble where stock values were artificially inflated because of "irrational 
exuberance." Then there's always bogus valuations because of a "short 
squeeze" where a current valuation isn't realistic and is merely the result 
of market conditions.




> Do Apple's investors have this $740 billion?  No.  They *spent* money
> for their shares.  They now have pieces of paper representing fractional
> ownership of Apple's equity (which is nowhere near $740 billion) instead
> of the actual money they used to have.

No matter what stock or bond you have, until you sell it's just a piece of 
paper. (Assuming you even have the stock certificate on hand.)

And when you finally do sell the shares then you gets something truly 
valuable... you get a some other pieces of paper that are called "money." 
This paper is better than the that other paper. (okay, so it's technically 
cloth not paper.)

In reality you don't even get these pieces of paper we call "money." What 
you actually get is a few computer bits in your bank account have now been 
updated with new bit values. You don't even get the pieces of paper... some 
bank has some new bits in their computer and that's what people work for 
their entire lives.

At the end of the work week give me a pig, some eggs and a loaf of bread. 
Something more "real" than updating a few bits at my Bank of America 
account.

-- 
"... we see Apple's downward spiral is gaining steam."

12/18/2012
RonB/wRonG
<kar4ju$i7i$2@dont-email.me>

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#289477

Ezekiel <zeke@nosuchemail.com> wrote:

> "owl" <owl@rooftop.invalid> wrote in message 
> news:vnhguf93.kjhg@rooftop.invalid...
>> Ezekiel <zeke@nosuchemail.com> wrote:
>>> "owl" <owl@rooftop.invalid> wrote in message
>>> news:jgnvmb83.gkjd@rooftop.invalid...
>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>
>>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>>> news:bghvur80.ra0@rooftop.invalid...
>>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>>
>>>>>>> "owl" <owl@rooftop.invalid> wrote in message
>>>>>>> news:gbvjdu03.pa3f@rooftop.invalid...
>>>>>>>> Ezekiel <zeke@nosuchemail.com> wrote:
>>>>>>>>> Apple is worth twice as much as Google.
>>>>>>>>
>>>>>>>>> Or Google is worth 1/2 as much as Apple if you prefer.
>>>>>>>>
>>>>>>>>>     AAPL = $740.33B
>>>>>>>>>     GOOG = $367.59B
>>>>>>>>
>>>>>>>>> I know many of you are confused because of "share price."  But 
>>>>>>>>> don't
>>>>>>>>> be.
>>>>>>>>> It's market-capitalization that determines what a company is worth.
>>>>>>>>> Not
>>>>>>>>> the
>>>>>>>>> share price.
>>>>>>>>
>>>>>>>>> Don't be like this dimwit below.
>>>>>>>>
>>>>>>>>> -- 
>>>>>>>>> "Share price is a measure of market confidence based on current
>>>>>>>>> performance.
>>>>>>>>> The market is apparently twice as confident of ($600) Google as it 
>>>>>>>>> is
>>>>>>>>> of
>>>>>>>>> ($320) Apple, and 20 times more confident than it is of ($28)
>>>>>>>>> Microsoft.
>>>>>>>>> So
>>>>>>>>> what Google is doing today is apparently better than what others 
>>>>>>>>> are
>>>>>>>>> doing."
>>>>>>>>
>>>>>>>>> Homer the "advocate" lecturing others on another simple concept he
>>>>>>>>> completely fails to understand
>>>>>>>>
>>>>>>>> Yeah, but market cap is basically a popularity contest.
>>>>>>
>>>>>>> To a very small extent. There's always the "now company people want 
>>>>>>> to
>>>>>>> see
>>>>>>> in the portfolio" thing but it's primarily based on fundamentals and
>>>>>>> expected future earnings.
>>>>>>
>>>>>>
>>>>>>>> Apple doesn't have
>>>>>>>> all that money, and they don't get money every time a share of Apple
>>>>>>>> stock
>>>>>>>> is sold at a higher price.  Apple got paid one time - the day the
>>>>>>>> stock
>>>>>>>> was
>>>>>>>> issued.
>>>>>>
>>>>>>> Yes and no. When a company has their IPO they don't release all the
>>>>>>> shares.
>>>>>>> It's called the "float" and nearly every company owns and holds 
>>>>>>> shares
>>>>>>> in
>>>>>>> their own company. When you hear a company is spending billions on a
>>>>>>> "stock
>>>>>>> buyback" then they're buying more of their own shares. Companies use
>>>>>>> the
>>>>>>> shares they own for bonuses, etc but they'll also sell some shares to
>>>>>>> raise
>>>>>>> capital.
>>>>>>
>>>>>>
>>>>>>>> 2014 Liabilities & Shareholders' Equity:
>>>>>>>> Apple: 231.84B
>>>>>>>> Google: 131.13B
>>>>>>>> Microsoft: 172.38B
>>>>>>>>
>>>>>>>> http://www.marketwatch.com/investing/stock/aapl/financials/balance-sheet
>>>>>>>> http://www.marketwatch.com/investing/stock/goog/financials/balance-sheet
>>>>>>>> http://www.marketwatch.com/investing/stock/msft/financials/balance-sheet
>>>>>>>>
>>>>>>
>>>>>>> This is an interesting accounting trick. You see companies with 
>>>>>>> insane
>>>>>>> amounts of money in the bank yet these companies issue debt (ie -
>>>>>>> borrow
>>>>>>> money) to raise capital.
>>>>>>
>>>>>>> The reason behind this is that Apple/Microsoft/Google have the 
>>>>>>> highest
>>>>>>> possible bond ratings. So they can borrow money at a low interest 
>>>>>>> rate
>>>>>>> and
>>>>>>> then deduct the interest from their taxes.
>>>>>>
>>>>>>> Most/much/shitloads of the cash they have is overseas. So if they 
>>>>>>> were
>>>>>>> to
>>>>>>> bring that cash back into the US they would need to pay US taxes on 
>>>>>>> the
>>>>>>> money. So it's cheaper to borrow money (at low rates) than it is to
>>>>>>> bring
>>>>>>> in
>>>>>>> money from foreign subsidiaries.
>>>>>>
>>>>>> Actually I grabbed the wrong line.
>>>>>>
>>>>>> Total Equity 2014:
>>>>>> Apple: 111.55B
>>>>>> Google: 104.5B
>>>>>> Microsoft: 89.78B
>>>>>>
>>>>>> So they are really *much* closer than market cap would indicate.
>>>>>> I mean, really, if Apple's share price fell to $1 tomorrow, based on
>>>>>> some wild news that made everybody suddenly hate the company and dump
>>>>>> their stock, the company would still actually be in the black to the
>>>>>> tune of 111.55 billion
>>>>
>>>>> Having $111 billion in the bank isn't a bad thing. According to their
>>>>> latest
>>>>> SEC filing it's now up to $178 Billion.
>>>>
>>>>>     "Apple has mind-boggling $178 billion in cash to spend"
>>>>>     (CNN-Money)
>>>>
>>>>
>>>>
>>>>>> and the shareholders could force the board
>>>>>> to give them some moolah.
>>>>
>>>>> Here's where it gets tricky. For example, Google founders did a
>>>>> power-play
>>>>> and made it so that ordinary share-holders have no voting rights. On 
>>>>> top
>>>>> of
>>>>> that, their special "class-B shares" (that don't trade on the market) 
>>>>> get
>>>>> 10
>>>>> votes/share whereas ordinary class-A shares get only 1 vote per share.
>>>>
>>>>> The bottom line is that even if every single Google shareholder in the
>>>>> world
>>>>> agreed on something - they can't force the company/board to do squat.
>>>>
>>>>> <quote>
>>>>> I believe this stock split is largely being done so that Sergey Brin 
>>>>> and
>>>>> Larry Page can maintain voting control over everyone else.
>>>>
>>>>> However if they don't execute well they can't be "forced" to change by
>>>>> everyone else.
>>>>
>>>>> Currently everyone except Brin, Page, Eric Schmidt, Google's ex-CEO and
>>>>> Executive Chairman, and a few other people own Class A shares. Class A
>>>>> shares get one vote for each share.
>>>>
>>>>> Class B shares are largely owned by Brin, Page and Schmidt and they get
>>>>> 10
>>>>> votes per share. In total there were 56,167,343 Class B shares
>>>>> outstanding
>>>>> on January 30, 2014.
>>>>
>>>>> Class C shares will be given to the Class A and B shareholders but
>>>>> receive
>>>>> no votes on stockholder resolutions. Their trading symbol will be the
>>>>> historical GOOG after the split. These are the shares that the company
>>>>> will
>>>>> probably issue going forward for acquisitions or stock awards.
>>>>
>>>>
>>>>> This means that Brin and Sergey have 468 million votes compared to the
>>>>> 280
>>>>> million Class A shareholders, essentially complete control of the 
>>>>> company
>>>>> as
>>>>> they have just over 55% of the total votes. Maybe the Board could exert
>>>>> enough pressure on either Brin or Page to step down if they thought it
>>>>> was
>>>>> being taken in such a wrong direction that it warranted action but
>>>>> otherwise
>>>>> the founders have complete control.
>>>>> </quote>
>>>>> http://www.forbes.com/sites/chuckjones/2014/04/02/google-stock-split-in-larry-and-sergey-we-trust/
>>>>
>>>>
>>>>
>>>>>> Regardless of whatever is happening trade-wise on the market, a stock
>>>>>> represents an ownership share of the company, and if the company is
>>>>>> strong financially, that share has value separate from its market 
>>>>>> value.
>>>>>> Likewise, whatever inflated price a stock might be selling for has no
>>>>>> real relation to the "value" of a company.
>>>>
>>>>> A companies assets (like $178 billion in the bank) gets factored into 
>>>>> the
>>>>> companies valuation. So in Apple's case, they're a $562 billion dollar
>>>>> company with $178 billion in the bank.
>>>>
>>>> All that really means though is, "this is how we're going to do the 
>>>> math."
>>>> A company is truly only worth its net worth: assets - liabilities.  The
>>>> stock market is just respectable a means of gambling and has no 
>>>> relevance
>>>> the value of a company.  If I decide to buy Apple one day, there's no
>>>> way I'm paying $740 billion for a company....
>>
>>> True, there's no way you'd ever pay $740 billion for Apple. If
>>> (hypothetically) this were to happen then you'd be paying about $925
>>> Billion.
>>
>>> Acquisitions happen all of the time. The company being bought out is 
>>> usually
>>> paid about a 25% premium. Example from just last week:
>>
>>> <quote>
>>> Mylan, one of the big makers of generic drugs, made public on Wednesday 
>>> an
>>> unsolicited offer to acquire Perrigo for about $29 billion in a deal that
>>> would extensively expand its range of product offerings.
>>
>>> Under the offer, announced on Wednesday, Mylan would pay $205 a share in
>>> cash and stock for Perrigo, a 25 percent premium over Perrigo's stock 
>>> price
>>> last Friday. Mylan did not specify what the split of cash and stock would
>>> be.
>>> </quote>
>>
>>
>>
>>>>  that has a net worth of $178 billion.
>>
>>> The "net worth" or what you've called book-value is going to be very low 
>>> for
>>> any company. What's the book value for Google ($367B) ... they own a 
>>> bunch
>>> of used servers? What's the book value for Visa ($161B) - they don't own
>>> much of anything. Or a bank like Wells Fargo ($281B) where they mainly 
>>> hold
>>> money that doesn't even belong to them.
>>
>>> The way to look at these companies is to view them as a money-making
>>> machine. If your neighbor offerred to sell you a "machine" that legally
>>> produces $100k/year in cash then what would you be willing to pay for the
>>> machine? Would you tell him to take a hike because there's only $3000 
>>> worth
>>> of parts in this machine?
>>
>>> Not that this is sustainable, but I'll use Apple's last quarterly 
>>> earnings
>>> as an example:
>>
>>>     <quote>
>>>     Apple just posted the best quarter in corporate history
>>
>>>     Apple (AAPL) sold 74.5 million iPhones in the last three months.
>>>     That helped Apple's profit soar more than 37% to $18 billion.
>>>     </quote>
>>>     http://money.cnn.com/2015/01/27/technology/apple-iphone-earnings/
>>
>>> It's a money-making-machine that's currently generating a profit of $8.25
>>> million dollars an hour, 24x7 around the clock. *That* is what gives them
>>> their market cap.
>>
>> That doesn't change the fact that "market cap" has no real meaning.
>> It does not represent any tangible asset that the company or its
>> investors possess.
>>
>> In other words, Apple's $740 billion market cap might as well be thought
>> of as "the missing $740 billion."
>>
>> So where is this missing $740 billion?
>>
>> Does Apple have this $740 billion?  No.
>>
>> Do Apple's investors have this $740 billion?  No.  They *spent* money
>> for their shares.  They now have pieces of paper representing fractional
>> ownership of Apple's equity (which is nowhere near $740 billion) instead
>> of the actual money they used to have.
>>
>> Who does have this missing $740 billion then?
>>
>> Some of it is in the hands of the people (AKA the Smiling Ones) who sold
>> the current Apple stockholders their pieces of paper.
>>
>> The rest of it doesn't even exist at all, because market cap is just
>> a price tag.  And a price tag is not the same thing as money.
>>

> Ahhh... Now I see what you're saying.

> Sure, market cap doesn't represent any tangible value. It's simply 
> share-price multiplied by the number of shares outstanding. It's the 
> calculated equity value of a company. There's no actual $740 billion dollars 
> anywhere. I certainly agree with that.

> It's like when a stock price goes up or down by 10% one day. In Apple's 
> case, did an additional $75 billion magically appear or disappear from the 
> day before? Yeah - there's no real/actual money anywhere. The market cap is 
> just the current value that the investment community puts on a company.

> It's basically a way of expressing the total combined value of all the 
> company shares. In a perfect world this value would be pretty accurate and 
> consistent but in the real world it's not. There are things like the dot-com 
> bubble where stock values were artificially inflated because of "irrational 
> exuberance." Then there's always bogus valuations because of a "short 
> squeeze" where a current valuation isn't realistic and is merely the result 
> of market conditions.




>> Do Apple's investors have this $740 billion?  No.  They *spent* money
>> for their shares.  They now have pieces of paper representing fractional
>> ownership of Apple's equity (which is nowhere near $740 billion) instead
>> of the actual money they used to have.

> No matter what stock or bond you have, until you sell it's just a piece of 
> paper. (Assuming you even have the stock certificate on hand.)

> And when you finally do sell the shares then you gets something truly 
> valuable... you get a some other pieces of paper that are called "money." 
> This paper is better than the that other paper. (okay, so it's technically 
> cloth not paper.)

> In reality you don't even get these pieces of paper we call "money." What 
> you actually get is a few computer bits in your bank account have now been 
> updated with new bit values. You don't even get the pieces of paper... some 
> bank has some new bits in their computer and that's what people work for 
> their entire lives.

> At the end of the work week give me a pig, some eggs and a loaf of bread. 
> Something more "real" than updating a few bits at my Bank of America 
> account.

Cool.  I'll put my house on the market at $80 trillion and upgrade my
market cap. 

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#289478

On Monday, April 13, 2015 at 2:35:30 PM UTC-6, owl wrote:

(snip)

> > In reality you don't even get these pieces of paper we call "money." What 
> > you actually get is a few computer bits in your bank account have now been 
> > updated with new bit values. You don't even get the pieces of paper... some 
> > bank has some new bits in their computer and that's what people work for 
> > their entire lives.
> 
> > At the end of the work week give me a pig, some eggs and a loaf of bread. 
> > Something more "real" than updating a few bits at my Bank of America 
> > account.
> 
> Cool.  I'll put my house on the market at $80 trillion and upgrade my
> market cap.

His point is valid, one could make this argument all the way down to the specific thing you're talking about when you use the term "money" and, in doing so, render the entire argument moot. 

Value is subjective, news at 11 ;)

[toc] | [prev] | [next] | [standalone]

#289498

Steve Carroll <fretwizzer@gmail.com> wrote:
> On Monday, April 13, 2015 at 2:35:30 PM UTC-6, owl wrote:

> (snip)

>> > In reality you don't even get these pieces of paper we call "money." What 
>> > you actually get is a few computer bits in your bank account have now been 
>> > updated with new bit values. You don't even get the pieces of paper... some 
>> > bank has some new bits in their computer and that's what people work for 
>> > their entire lives.
>> 
>> > At the end of the work week give me a pig, some eggs and a loaf of bread. 
>> > Something more "real" than updating a few bits at my Bank of America 
>> > account.
>> 
>> Cool.  I'll put my house on the market at $80 trillion and upgrade my
>> market cap.

> His point is valid, one could make this argument all the way down to the specific thing you're talking about when you use the term "money" and, in doing so, render the entire argument moot. 

> Value is subjective, news at 11 ;)

Some value is objective, such as net worth, or "book value" if you like.
Other "value," such as sticker price, is meaningless from a value standpoint.

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#289613 — How many barrels of oil will the stock produce ?

Ezekiel,

One of my jobs is to simulate the income of competing banks.

Google: ABA Jeff Relf
BankExec.swGSB.ORG/manual/BXD_Decision_Manual.pdf

When considering whether to buy|sell a stock or not,
first I'd try to predict where the price of oil is going,
then I'd consider the stock's potential income.

How many barrels of oil will the stock produce ?

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#289708 — Re: How many barrels of oil will the stock produce ?

"Jeff-Relf.Me" <@.> wrote in message 
news:Jeff-Relf.Me@Apr.13{11.42P.Seattle.2015}...
> Ezekiel,
>
> One of my jobs is to simulate the income of competing banks.
>
> Google: ABA Jeff Relf
> BankExec.swGSB.ORG/manual/BXD_Decision_Manual.pdf
>
> When considering whether to buy|sell a stock or not,
> first I'd try to predict where the price of oil is going,

Where oil is going is anyone's guess. I've read financial articles where the 
author makes a good case for oil returning back to $80/barrel. Other 
financial articles make a good case for oil dropping into the $30/barrel 
range. Right now it's $53.

I don't follow commodities so I don't have much of an opinion on where oil 
is going. If anything I'm likely to agree with T. Boone Pickens (an 
experienced oil man) who thinks it's going up.


> then I'd consider the stock's potential income.
>
> How many barrels of oil will the stock produce ?

The price of oil affects some stock prices more directly than it affects 
others. Here's some random (off the cuff) thoughts from me:

Exxon/Mobil, BP, etc. - It obviously affects these companies directly.
Refiners, drillers and oil equipment manufacturers - Directly affected
Companies that use a lot of oil/gasoline (truckers, airlines) - Directly 
affected (in a positive way)

Companies who export lots of goods to oil producing companies - Indirectly 
affected. Some of these countries (like Venezuela) are getting crushed by 
the low price of oil. If your company sells a lot of good to Venezuela/etc 
then you'll feel their pain.

Retailers/restaurants - Indirectly affected. Consumers do have some more 
cash in their pocket from lower gas prices.

Technology, pharma, biotech, social-media, etc - Barely any affect. Slight 
positives and negatives cancel out. People aren't going to surf the web or 
Tweet more because of oil prices.

Just my 2-cents worth. Good luck.

-- 
This reminds me of a Relf classic.

    "Testing is how you know
     if the  code works or not,
     not compile-time warnings."
     -  Jeff Relf

Heh.  One doesn't need to be a pro, to know how stupid that is...


New thread from turdv displaying his ignorance
June 13, 2014
<d6plp958n3o545aqg62banloa9sip3ds6n@4ax.com>

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#289714 — How many barrels of oil will the stock produce ?

Ezekiel,

The rising price of oil burst the tech bubble, 2000;
and the real estate market, 2008.

Makes you wonder about 2016, doesn't it ?

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#289732 — Re: How many barrels of oil will the stock produce ?

"Jeff-Relf.Me" <@.> wrote in message 
news:Jeff-Relf.Me@Apr.14{10.55A.Seattle.2015}...
> Ezekiel,
>
> The rising price of oil burst the tech bubble, 2000;
> and the real estate market, 2008.
>
> Makes you wonder about 2016, doesn't it ?

"A few years ago, Andrea Pescatori, an economist who is now at the 
International Monetary Fund, tried to measure the relationship between oil 
and stock prices. He basically wound up throwing up his hands on the matter. 
Sometimes oil prices follow the stock market and vice versa. And sometimes 
they head in opposite directions."
http://fortune.com/2014/10/15/stock-market-plunge-oil-prices/

The two could be related this time. Unless they're not.

-- 
"M$ Windows is also why computers have a soft-reset button. Apparently Macs 
have them too."

The clueless Dumb Willy
April 8, 2015
<6vefvb-4bf.ln1@user-1842.linux.individual.net>


    The (Atari) 520ST rear panel. Left to right:
    RESET switch, Power switch....
    http://classiccmp.org/dunfield/atarist/index.htm

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