OSNews

Apple gets views. Don't stress it's just how it is.

Glad to see I'm not the only one to think so. Seriously, this only is newsworthy to Apple shareholders.

About Page 2...

I often found the articles published in Page 2 more interesting than the articles shown in Page 1.

What if OSNews staff puts all the techie things in page 1 and all the Funds, Stallman discussions or Apple finantial status in Page 2?

I use the RSS feed within Firefox so I never really see the Page 1 or Page 2, just the news. Thanks for clarifying that the pages are split based on length and not importance!

Apple doing reasonably well hey?

Didn't you write an article not long ago saying how Apple was going to perish like it's PC Counterparts?

And it's because of fat margins now?

Yet people are still buying even though they're more expensive and not choosing cheaper alternatives.

Interesting.

And it's Apple's (perceived?) expensiveness - more to the point really their "couldn't give a rats if it isn't the cheapest" customer base - that is the reason they're going to continue to do ok.

Its exactly the same as in the "luxury" car market. People who buy luxury cars aren't all of a sudden going to buy Toyota or Kia because of the global economic climate. In fact the majority of that demographic - despite difficult times - will still have significantly more disposable income, and that is the market Apple are in. PC prices have dropped 20% to accommodate the decline in the global marketplace. Apple haven't gone that path because they really don't need to. That may sound elitist but its just the way it is.

Then of course they have their iTunes business...

Well said!

The thing to be skeptical about is whether the income of the Apple demographic will hold up through this recession. It is not, as with the luxury end of the auto market, genuine asset based wealth. Its disposable income, not really wealth, due to jobs which have derived from the consumer credit boom. These jobs will go, and this demographic is probably more heavily indebted and less financially secure than anyone realizes.

If the recession continues another three or four quarters, and the media businesses start seriously retrenching and going bust, Mac and Apple sales generally will take a steep dive.

It may not happen, but they are not protected against recession by their demographic.

Edited 2009-04-17 07:37 UTC

The wiser path would be not to sell, but merely hold on and let it grow. Investments should never be considered as short term get rich quick schemes, but rather a method to expand a portfolio for the long term (years, decades). You should really look at your stock purchase as a 20-30 year/retirement purchase. Also, if the specific company pays out dividends, then the point should be to collect more, not sell.

I am of the age where I saw so many back in the mid nineties jump onto the online stock trading, and just thought of it as a game. I really wonder if any have any value left? I was very fortunate to have been investing before hand and given direction by an older brother. With time I have seen the whole stock portfolio expand without spending a dime. Quite a few have had splits, then risen which gave me more value without spending a single penny. Of course 'today' it sucks, but then again I have no plans to sell for quite some time (e.g. decades)

But long term isn't how American's think. We think short term 1 quarter at the most. Heck, most people think long term is one week. It would be funny if it weren't so true.

Unfortunately this short term thinking contagion has now infected most other countries - where you have, in all due respects, idiots expecting they can throw $1,000 in one end of the 'machine' and out the other side in 6 months time they have $1 million.

The problem with the US is that their share market is based on the bigger idiot principle coupled solely capital growth wealth creation (share price going up) rather than long term dividend payment. When you run out of idiots and capital growth dies because it is pretty based off hype (Sun changing their name to JAVA is a prime example of trying to use hype to push up the share price) results in massive swings - is anyone surprised at fall out?

Mind you, if people want to feel like they've 'won' something each month - just buy some bonus bonds ( http://www.bonusbonds.co.nz/index.html (background information: http://en.wikipedia.org/wiki/Bonus_Bonds ) ) - all the excitement of lotto with no money lost in the process.

Edited 2009-04-16 23:22 UTC

You made a series of classic mistakes: you bought stock when the PE ratio was in the stratosphere, and you bought shares because you liked the products. Yes, there were expectations of growth. But they were already discounted in the price. In addition, you were not only buying a high PE ratio stock, you were buying a very volatile one, and one which was a favored vehicle for hedge funds, whose trading volume as a percentage of outstanding shares was among the highest on any US exchange. It was a recipe for disaster.

What to do?

1) Look at PE ratios before buying. And watch for the quality of the E.

2) Don't buy one company. Buy a broad based ETF.

3) Find out about, and use, 12 month moving averages on your broad based ETF.

4) Never confuse the fortunes of the company, the fortunes of the stock, and what you feel about the product. If you have learned this from your adventure, it was the best value lesson you will ever have, and you'll think in later life that it was incredibly cheap at the price.

5) If despite this advice you really want to buy individual stocks, get a copy of Graham, Dodd Cottle 'Securities Analysis', and study it carefully. Yes, its huge. That's what it takes. If you cannot or will not do that, you've no business buying individual stocks. You are trying to compete with the pros without working at it, and you have no chance. Go to the races instead, its less risky.

True but on the other hand the US is a big market that is flush with money. At least it was until recently.
When (not if) U.S sales starts to drop for Apple it will be interesting to see how they will cope.

The US market is largely saturated. Most new user growth is going to come from lower income countries. That means cheap PCs such as netbooks/nettops. Apple can't operate profitably in that niche.

Well there are Mac users outside the US - speaking as one.

Leaving that aside: a modest scale producer with healthy margins and committed to the quality of its products will survive better than a larger producer with thin margins.

Like it or not, Apple have the financial reserves to change strategy without stampedes or fire sales.

How Apple choose to deal with this downturn will be interesting and probably instructive. My suspicion is that computer makers who pay attention to quality and service will retain paying customers; and the rest will be living on less and less. At the end of the day, the rest of us have a job to do and need appliances that work and suppliers who fix them without threat of legal or illegal sanction.