carlson73's Comments RSS Syndication from SeekingAlpha.com http://seekingalpha.com/user/729453/comments http://seekingalpha.com/article/1443061/comments?source=feed#comment-18944431 18944431 Fri, 17 May 2013 11:06:59 -0400 http://seekingalpha.com/article/1429891/comments?source=feed#comment-18816541 18816541 Tue, 14 May 2013 13:28:51 -0400 http://seekingalpha.com/article/1405191/comments?source=feed#comment-18496821 18496821 Similarly, the more frequent there are meaningful design changes in new products the more expensive tooling and equipment will cost as a percentage of sales. If a product really had a one year sales life, then equipment and tooling unique to that design should not even be capitalized, just expensed.]]> Mon, 06 May 2013 12:32:52 -0400 Similarly, the more frequent there are meaningful design changes in new products the more expensive tooling and equipment will cost as a percentage of sales. If a product really had a one year sales life, then equipment and tooling unique to that design should not even be capitalized, just expensed.]]> http://seekingalpha.com/article/1355561/comments?source=feed#comment-17874411 17874411 Sat, 20 Apr 2013 13:20:30 -0400 http://seekingalpha.com/article/1351111/comments?source=feed#comment-17830851 17830851 Secondly, the next quarter is not the issue. A P/E ratio of 9 becomes 18 (probably more) without changing the stock price if margins are cut in half. Apple has been (and are) incredibly successful in one of the most dynamic and competitive markets in the history of business. They have been brilliant, and their financials demonstrate that. That is kind of the whole point, we are not talking about a company like Exxon where what you see is likely to be what you see in five years. We don't know if smart phones will be complete commodities in five years or differentiated products where the user will pay high prices for a tool that manages their life. Given that by far the dominant financial driver of their results is still the iphone, a product where the competition is closing the functionality gap and maybe even the image gap quickly, why would the margins they command remain this good? The whole thesis their stock is grossly under priced disappears if their margins are halved. They do not have to lose any market share to be a much more normal company financially, all they have to do is lose enough pricing power that the phone companies finally stop paying huge subsidies. Can they maintain their margins? I have no idea, but I will not bet they can maintain them for five years (five product generations) in the face of competent determined competitors, and phone companies (customers) that would love to lower their cost to supply users with phones. Several early adopter friends that have previously been committed to the iphone have switched to Samsung, not that there was anything wrong with their iphones, but it was time to try something else. I was actually surprised. Maybe my friends choices are isolated instances, but maybe not.It is a great company, but they are in an industry where a dominant market position can disappear in two or three years, and young users are not afraid to try something new, in fact they frequently want to.If they are good stewards of their current cash flows, I would agree it may be a good investment at this price, but short of any commitment to shareholders as to how they will manage these cash flows, I won't invest in them. For all of Steve Job's brilliance, I do believe it is clear he never really considered Apple's cash the shareholders money. Tim Cook has improved this, but I am not convinced they fully get it yet.I hope it works out for you.
]]> Fri, 19 Apr 2013 10:14:54 -0400 Secondly, the next quarter is not the issue. A P/E ratio of 9 becomes 18 (probably more) without changing the stock price if margins are cut in half. Apple has been (and are) incredibly successful in one of the most dynamic and competitive markets in the history of business. They have been brilliant, and their financials demonstrate that. That is kind of the whole point, we are not talking about a company like Exxon where what you see is likely to be what you see in five years. We don't know if smart phones will be complete commodities in five years or differentiated products where the user will pay high prices for a tool that manages their life. Given that by far the dominant financial driver of their results is still the iphone, a product where the competition is closing the functionality gap and maybe even the image gap quickly, why would the margins they command remain this good? The whole thesis their stock is grossly under priced disappears if their margins are halved. They do not have to lose any market share to be a much more normal company financially, all they have to do is lose enough pricing power that the phone companies finally stop paying huge subsidies. Can they maintain their margins? I have no idea, but I will not bet they can maintain them for five years (five product generations) in the face of competent determined competitors, and phone companies (customers) that would love to lower their cost to supply users with phones. Several early adopter friends that have previously been committed to the iphone have switched to Samsung, not that there was anything wrong with their iphones, but it was time to try something else. I was actually surprised. Maybe my friends choices are isolated instances, but maybe not.It is a great company, but they are in an industry where a dominant market position can disappear in two or three years, and young users are not afraid to try something new, in fact they frequently want to.If they are good stewards of their current cash flows, I would agree it may be a good investment at this price, but short of any commitment to shareholders as to how they will manage these cash flows, I won't invest in them. For all of Steve Job's brilliance, I do believe it is clear he never really considered Apple's cash the shareholders money. Tim Cook has improved this, but I am not convinced they fully get it yet.I hope it works out for you.
]]> http://seekingalpha.com/article/1349631/comments?source=feed#comment-17798371 17798371 Thu, 18 Apr 2013 14:43:06 -0400 http://seekingalpha.com/article/1350161/comments?source=feed#comment-17796051 17796051 The only way to manage them well is to expect them to happen by understanding the phenomenon and realizing the models facilitate making the problem worse.]]> Thu, 18 Apr 2013 13:59:36 -0400 The only way to manage them well is to expect them to happen by understanding the phenomenon and realizing the models facilitate making the problem worse.]]> http://seekingalpha.com/article/1351111/comments?source=feed#comment-17793561 17793561 Thu, 18 Apr 2013 13:03:54 -0400 http://seekingalpha.com/article/1348401/comments?source=feed#comment-17767091 17767091 Wed, 17 Apr 2013 21:39:20 -0400 http://seekingalpha.com/article/1339281/comments?source=feed#comment-17623081 17623081 Mon, 15 Apr 2013 00:06:38 -0400 http://seekingalpha.com/article/1328051/comments?source=feed#comment-17409891 17409891 Tue, 09 Apr 2013 13:50:09 -0400 http://seekingalpha.com/article/1310321/comments?source=feed#comment-17087031 17087031 Mon, 01 Apr 2013 16:55:55 -0400 http://seekingalpha.com/article/1275971/comments?source=feed#comment-16333221 16333221 Fri, 15 Mar 2013 12:41:23 -0400 http://seekingalpha.com/article/1260691/comments?source=feed#comment-16101101 16101101 Sun, 10 Mar 2013 14:19:14 -0400 http://seekingalpha.com/article/1245271/comments?source=feed#comment-15867001 15867001 In reality, I think at various intervals Buffett has basically confirmed it is much harder to do exceptionally well as a huge company. It does not mean they will not do well, but to do exceptionally well at Berkshire's size, there will have to be a lot of mis-pricing of large companies in the market. I would guess without the expensive preferred stock portion of the deal, Buffett would not have been interested in Heinz.]]> Tue, 05 Mar 2013 12:36:10 -0500 In reality, I think at various intervals Buffett has basically confirmed it is much harder to do exceptionally well as a huge company. It does not mean they will not do well, but to do exceptionally well at Berkshire's size, there will have to be a lot of mis-pricing of large companies in the market. I would guess without the expensive preferred stock portion of the deal, Buffett would not have been interested in Heinz.]]> http://seekingalpha.com/article/1220841/comments?source=feed#comment-15536271 15536271 Tue, 26 Feb 2013 14:24:34 -0500 http://seekingalpha.com/article/1220281/comments?source=feed#comment-15530161 15530161 Tue, 26 Feb 2013 12:30:15 -0500 http://seekingalpha.com/article/1219491/comments?source=feed#comment-15485341 15485341 He did not tax the truly wealthy as badly as those trying to become wealthy by working at high paying jobs.]]> Mon, 25 Feb 2013 14:11:12 -0500 He did not tax the truly wealthy as badly as those trying to become wealthy by working at high paying jobs.]]> http://seekingalpha.com/article/1220281/comments?source=feed#comment-15485051 15485051 Mon, 25 Feb 2013 14:04:12 -0500 http://seekingalpha.com/article/1213481/comments?source=feed#comment-15417641 15417641 Sat, 23 Feb 2013 13:26:59 -0500 http://seekingalpha.com/article/1200911/comments?source=feed#comment-15215811 15215811 Tue, 19 Feb 2013 14:14:32 -0500 http://seekingalpha.com/article/1201701/comments?source=feed#comment-15215341 15215341 Tue, 19 Feb 2013 14:04:05 -0500 http://seekingalpha.com/article/1199891/comments?source=feed#comment-15160901 15160901 Mon, 18 Feb 2013 12:16:29 -0500 http://seekingalpha.com/article/1137041/comments?source=feed#comment-14254541 14254541 Mon, 28 Jan 2013 10:17:14 -0500 http://seekingalpha.com/article/1105261/comments?source=feed#comment-13595621 13595621 Just what we need another trillion $ of debt.]]> Fri, 11 Jan 2013 13:09:37 -0500 Just what we need another trillion $ of debt.]]> http://seekingalpha.com/article/1104201/comments?source=feed#comment-13540771 13540771 France's attempts to bully countries into not rationalizing factories is being shown as the fraud that it is, in fact Hollande is going to be able to keep about zero of the promises he made.
As far as the graph goes, at least local governments in the US have adjusted their hiring to make their budgets work, (California, Illinois and a couple of others being huge exceptions), US companies are making a lot of money, and US banks balance sheets are reasonably clean at this point. None of those can be said for Europe.
While the human cost of that in the US is very painful, it does leave companies (even banks) in the position to grow going forward and not trying to play games with the government about the companies' own economics.]]> Thu, 10 Jan 2013 11:22:02 -0500 France's attempts to bully countries into not rationalizing factories is being shown as the fraud that it is, in fact Hollande is going to be able to keep about zero of the promises he made.
As far as the graph goes, at least local governments in the US have adjusted their hiring to make their budgets work, (California, Illinois and a couple of others being huge exceptions), US companies are making a lot of money, and US banks balance sheets are reasonably clean at this point. None of those can be said for Europe.
While the human cost of that in the US is very painful, it does leave companies (even banks) in the position to grow going forward and not trying to play games with the government about the companies' own economics.]]> http://seekingalpha.com/article/1104111/comments?source=feed#comment-13536091 13536091 Thu, 10 Jan 2013 10:00:44 -0500 http://seekingalpha.com/article/1099441/comments?source=feed#comment-13441821 13441821 Tue, 08 Jan 2013 12:20:42 -0500 http://seekingalpha.com/article/1096311/comments?source=feed#comment-13402371 13402371 There is no doubt unions contributed immensely to the improvement of the working conditions and safety in the US, unfortunately their goals did not stop there.
"Busting unions" or transferring production either domestically or overseas is extremely expensive, risky and a large pain in the ass. Most companies don't do it if they have a choice, because they are risking customer good will and actual loss of business every time it is done, but at some point the management of a company is responsible to ensure the company can serve its customers well and compete economically. If they can not do it with a particular union they are responsible to make changes. Rational companies do not do it if they do not have to, although I am sure some companies have made the choice and regreatted it later when they found out how much work it is.
The positive impact of the unions on state finances will be even more startling, but Illinois, California and others will have to find their own way in "busting unions" when the unions happen to be major campaign contributors. Roosevelt was right, and Kennedy screwed up.
Personally Macro I think your accusations would be better directed if you looked at globalization and "free trade" as the root cause of the demise of both unions and unionized companies that failed to adjust to a much more competitive market where companies without huge legacy costs had big advantages. I believe in that case the culprits would be Bush I and Clinton, as well as Walmart and GE and others who have forced hundreds of thousands of jobs overseas. In my opinion Reagan's changes actually slowed the migration of jobs overseas,
even if it allowed the reduction in union jobs, but don't let reality get in the way of a good bias.]]> Mon, 07 Jan 2013 13:32:39 -0500 There is no doubt unions contributed immensely to the improvement of the working conditions and safety in the US, unfortunately their goals did not stop there.
"Busting unions" or transferring production either domestically or overseas is extremely expensive, risky and a large pain in the ass. Most companies don't do it if they have a choice, because they are risking customer good will and actual loss of business every time it is done, but at some point the management of a company is responsible to ensure the company can serve its customers well and compete economically. If they can not do it with a particular union they are responsible to make changes. Rational companies do not do it if they do not have to, although I am sure some companies have made the choice and regreatted it later when they found out how much work it is.
The positive impact of the unions on state finances will be even more startling, but Illinois, California and others will have to find their own way in "busting unions" when the unions happen to be major campaign contributors. Roosevelt was right, and Kennedy screwed up.
Personally Macro I think your accusations would be better directed if you looked at globalization and "free trade" as the root cause of the demise of both unions and unionized companies that failed to adjust to a much more competitive market where companies without huge legacy costs had big advantages. I believe in that case the culprits would be Bush I and Clinton, as well as Walmart and GE and others who have forced hundreds of thousands of jobs overseas. In my opinion Reagan's changes actually slowed the migration of jobs overseas,
even if it allowed the reduction in union jobs, but don't let reality get in the way of a good bias.]]> http://seekingalpha.com/article/1096311/comments?source=feed#comment-13367511 13367511 However, getting back to the original point of Steven's article, which is excellent, the income distribution in the country is a big problem, but it is not because there are not more or fewer unions. It is because, I believe, growth has been destroyed by the Fed's financial policies of the last twenty years which encouraged too much debt and created unbelievable asset bubbles twice, and a debt induced recession. With low growth, there is not sufficient competition for people that companies have to offer much more than inflation to the average employee. That does not help the economic status of employees at all in the long run.While the tax increases negotiated will not have huge negative impacts, I hope, I believe Steven is right that the income disparity is a problem not a cause and taxing the winners in a badly structured game will not fix the game. A more balanced pro-growth blend of policies, even if the tax increases were passed would have made a lot more sense.Unfortunately, at the moment pro-growth policies for both parties seems to consist of granting tax breaks or subsidies to their favorite corporate constituents.
Add in an education system that produces too filled skilled workers, resulting in too many people for competing for lower middle class jobs. Which makes the wage issue even worse for non-skilled jobs
.Fixing the real problems is getting harder not easier with the polarization of economic ideologies. ]]> Sun, 06 Jan 2013 14:57:08 -0500 However, getting back to the original point of Steven's article, which is excellent, the income distribution in the country is a big problem, but it is not because there are not more or fewer unions. It is because, I believe, growth has been destroyed by the Fed's financial policies of the last twenty years which encouraged too much debt and created unbelievable asset bubbles twice, and a debt induced recession. With low growth, there is not sufficient competition for people that companies have to offer much more than inflation to the average employee. That does not help the economic status of employees at all in the long run.While the tax increases negotiated will not have huge negative impacts, I hope, I believe Steven is right that the income disparity is a problem not a cause and taxing the winners in a badly structured game will not fix the game. A more balanced pro-growth blend of policies, even if the tax increases were passed would have made a lot more sense.Unfortunately, at the moment pro-growth policies for both parties seems to consist of granting tax breaks or subsidies to their favorite corporate constituents.
Add in an education system that produces too filled skilled workers, resulting in too many people for competing for lower middle class jobs. Which makes the wage issue even worse for non-skilled jobs
.Fixing the real problems is getting harder not easier with the polarization of economic ideologies. ]]>