SingHash

Not Everyone Likes Windows 7

BSoD on install? Sounds like the old days, when I'd load Linux onto hand-built-from-parts computers. You'll like your Apples much better when you realise that your time is worth something. All those precious megaflops aren't worth much when they flop unexpectedly and you lose a pile of work.

When the dark side beckons, take a deep breath and repeat the mantra, "A computer is worth what you I do with it." Then open your eyes and follow where that logic leads you, wherever that may be.

Microsoft vs. Apple - Which Is Worth More?

It is absurd to think that the business model MSFT will survive in developing-world economies. The harder MSFT clenches its fist around the pirates, the more business they will lose. Neither company offers a reasonable value proposition when an OS costs more than the average monthly wage. Would YOU pay a few thousand dollars for an OS and then a few more months' worth of salary for a frickin' Office suite? If you had to pay a proportional amount of your income for either manufacturer's products, then you'd be singing with the penguins faster than than you can say "WGA".

MSFT's response has been to offer a lobotomized version of Windows that only runs a few (three?) apps at a time, at a price of about US$30. That STILL doesn't represent any kind of rational value when the competition costs nothing at all. Don't talk about TCO, either: when your population numbers a billion people who are earning a few bucks a day, you will not find a dearth of support. The equation will only get more dire as hardware costs decrease and the "Microsoft Tax" rises.

AAPL's prospects in these markets are only marginally better: they're obviously "bling", and will likely maintain a proportional market share -- albeit against a Chrome / Linux / Windows triumvirate rather than the Windows behemoth of the developed world.

One of the key bits missing from Bruun's analysis is the unwinding of MSFT's network effect. It's already happening, and will only accelerate: people no longer need to buy Windows / Office to maintain usability with everybody else. Alternative formats (or near-compatible implementations) are emerging. Does anybody seriously think that MSFT can compete WITHOUT its monopoly?

Bruun is likely to lose money on both sides of his long/short.

Disclosure: long AAPL (up 1600%), long MSFT (down 20%)

Obama's Healthcare Reform: 2 Winners, 2 Losers

I live overseas, and I have great health insurance. There is, however, ONE place in the world where I am not allowed to get non-emergency care... the U.S.A. Here's the real joke: the only time I need health insurance is when I leave the country, because government-subsidized health care here is both cheap and plentiful. It's a simple system of public and private care; because public care is ALWAYS available (with longer lines and less-pretty nurses), the costs of private care are constrained.

Last I heard, the US had six paper-pushers for every real healthcare provider. That's a big part of the expense, and it's plain stupid. Surely those people can be doing something more useful -- like growing vegetables or being massage therapists or management consultants or something.

But no, the US has to pay claimbusters to investigate claims and refuse a certain percentage of them, which means that the docs have to hire claimbuster-busters, and...

And then those who aren't ready to die try to leave the country and work in a place where it's not an issue.

What Does a Bonus Really Cost?

Slater's analogy is a good one, as it cuts to the heart of the matter -- though perhaps not quite as he intended.

I do not WANT a gambler handling my finances; I want an investor with plenty of time and resources to eliminate as many variables as possible. The system, as it begins to topple, appears to have been built by INCREASING the number of variables to the point where money was divorced from any underlying value.

If the cap means that the gamblers go elsewhere, then some bright and hungry people of a different sort will step up to fill the gap. Considering the dismal performance of the gamblers, I can't see that as a bad thing.

Derivatives and Bank Collapse - The Scam That Went Largely Unreported

In a casino, at least, the odds are well known...

At the end of the day, it matters not one jot precisely how many times those idiots sold each other a dead donkey. Their paper debts to each other are easily written down, because they represent nothing of value. It's pretend money that has been completely dissociated from any tangible assets.

What we have, in the end, is a country that has industrial, natural, and human resources. Whether it can grow up and start behaving rationally is immaterial: if self-indulged citizens won't get to work, a new crop of willing workers will happily take their place.

I can only pray -- fervently -- that the inevitable corrections will not unduly penalize those who did NOT play the credit game. If I'm debt-free, lived within my means, and spent only the money I had, then I shouldn't be burdened with my neighbor's payments. Realistically, however, I expect to be severely punished for my lack of indiscretions.

Recession Rule #1: Cash Is King

Bait Rule #1 for aspiring financial writers: mention Apple but neglect to include any numbers; just give the wrong impression.

(As of last quarter, Apple has more cash than DELL, HPQ, IBM, & MSFT; only MSFT has better profit & margin stats.)

Treasury's Actions Not in Our Best Interest

The fed action merely validates irresponsible behavior on the part of lenders and borrowers alike. You don't cure an addict by giving him a few more bucks to fuel his addiction.

The point of a free market economy is that fiscal failure is punished by corporate death. Yet the same hands that are begging for alms now will be ranting against government interference and "creeping socialism" the moment they're held accountable to the public.

Disgusting.

Record Companies Starting to Shun iTunes

The labels "chafe" against the idea that I will buy what I want instead of the package they mandate? I hope they get chafed right down to the economic bone. It's called "giving the customers what they want".

Second, if it weren't available on iTunes, I wouldn't get it at all. Think of the huge numbers of "I want it now" consumers, and this trend is only going to increase. The"I'd buy it on CD" percentage of my iTunes purchases is about 2%.

The real problem for the labels is that this 'piecemeal' approach is screwing up their accounting. Instead of buying albums from 10 star performers, I'm buying singles from a hundred.

And finally, the environmental cost of those CDs should be considered. Not that computers are free of environmental sin, but every download I buy is one less bundle of CD, case, plastic, paper, and sales slip. It's a fraction of a reduced trip to the CD shop, complete with burning gasoline, wasted time, and parking fees. And as an earlier poster noted, I'm just going to rip the thing in iTunes anyway.

Chafe away, labels. You deserve it.

Steve Jobs Isn't Dead Yet!

On a slightly less hysterical note (for heaven's sake, Papita -- Bloomberg very briefly reported the demise of SJ; your host (J. West) is merely grafting the very real "succession question" onto Bloomberg's gaffe)...

...and with all due apologies AND compliments on an interesting article regarding said "succession question", I have to note that the Holy Grail skit in question ended with the lines:

(Arthur enters with squire Patsy)
Customer (John Cleese): Who's that, then?
Cart Master (Eric Idle): I dunno. Must be a king.
Customer: Why?
Cart Master: He hasn't got *^#! all over him.

*****

All of which might apply to Mr. Jobs, come to think of it. Just think of the options backdating scandals, the prosperity of the stock, and the fact that the company is wildly profitable even in the harshest of economic climates. The man, clearly, does not have &^@! all over him, and that makes him a king, dunnit?

Are Glorious Days Ahead for Microsoft?

Jack writes...

"However the lack of erosion in its incumbent business (for 25 years!) means that its core earnings are very unlikely to change."

I'm thinking of a company that was dominant -- absolutely, unassailably dominant -- for about 25 years. Big, powerful, and the only place to be if you really wanted to do serious computing.

Unfortunately, their business practices landed them in a bit of hot water, and they spent over a decade under intense legal scrutiny. It came to the point where legal caution stifled agility. When new, disruptive technologies emerged, the company was pummeled, decimated, and marginalized.

Eventually, they reinvented themselves and recovered pretty well -- but the paradigm had changed, and there were lots of new, more interesting places to work.

The company was IBM; the time span was 1960 - 1985. Microsoft -- which itself was instrumental in IBM's near-death experience -- is doing a lovely job of following a similar trajectory.

The best thing Microsoft could do for its shareholders right now (and I am one) would be to shut it down, liquidate its assets, and return the money to its shareholders.

Microsoft's Cashback: Changing the Internet Industry Forever

MSFT appears intent on turning the internet into a virtual strip mall. In the process, it will degrade the quality of the shopping experience and reduce customer service -- but only for those who are willing to suffer the misery of shopping on the seedy side of town for the sake of a few bucks.

The GOOD news is that this will hasten the demise of the common internet. I foresee cash-back retailers flocking to a their own TLD (top-level domain), while leaving the rest of the net less encumbered by their dreck. Think of the difference between a developing-world bazaar ("You buy Rolex, very good yes?") vs. high-end boutique ("Would sir like this Rolex? It's very good, isn't it?").

Eventually, cash-back will come out of the retailers' pockets, which means that they'll have to cut all the corners they can in order to survive. It'll be a race to the bottom for every vendor who chooses to participate. The boutiques, on the other hand, will do quite nicely, providing a pleasant experience and great customer service to those who are willing to pay a few extra dollars.

It's nothing more than a re-zoning of the internet, with MSFT paving the parking lots -- soon to be complete with potholes, derelicts, hoodlums, needles on the ground, and urine on the wall. Thanks, guys.

How Microsoft Could Kill Google on the Web

1. With free ads, MSFT is certain to provoke further antitrust ire -- in Europe and Korea if not in America. Even without its shameful record of corporate abuse, regulators simply wouldn't countenance such a ploy to leverage one monopoly into another.

2. Would you watch a television show during which the station was airing free ads? I'm not an economist, but I think this qualifies as an example of "the tragedy of the commons". I think (hope!) that most people go to the internet for _content_, so lowering the barriers to entry for non-content seems to be counter-productive.

7 Reasons You Can't Kill Microsoft

#2: That 140 million figure includes downgraders.

Most PCs have Vista pre-installed. Even if a user downgrades to XP, MS still counts this as a Vista user. It would be more accurate to count the number of boxed retail copies that were sold.

Is GE a Buy?

Sullivan says: "...why one would want to own it anyway?"

Okay. I'll answer that question for myself.

* Forward P/E: 12
* Dividend yield well over 3% @ 52% payout
* Profitable business
* Diversified across sectors, industries, technologies, and geographies

GE has deep pockets to buy out distressed OR dangerous competitors during an economic downturn.

In my eyes, these characteristics illustrate a stock to promote sound sleep through any economic turbulence.

Microsoft and Competitors Continue to Waste Resources on OOXML

Amen. Apologies that I haven't come across your previous posts on the topic. Cheers.