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Time:
12:53 EST/17:53 GMT | News Source:
PC World |
Posted By: Kenneth van Surksum |
In the past decade, Microsoft has acquired nearly 10 times as many companies as Apple, and spent nearly nine times as many dollars on research and development.
Yet Microsoft's stock price performance has stagnated these last 10 years, while Apple has soared to its current status as the world's most valuable tech firm, a title wrenched away from Microsoft just last week.
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#26 By
23275 (75.228.95.251)
at
6/5/2010 4:43:23 PM
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Be careful about vilifying derivatives and credit default swaps. They’ve been around to insure and insulate investments for a long time (1870’s) and are a very necessary tool used in order manage loss and risk. President Obama VERY quickly backed off modifying their use when he was told that doing so would destroy investing and shrink the global economy by as much as 40%.
Also, forget the notion that “Bush and the Republicans” de-regulated anything. Under Bush regulation actually increased and substantially. He was even accused of abuses of power by democrats by using his office to force more financial regulation. Barney Frank (D-MA) accused him of being a racist and alarmist for having done do (2001 and again in 2006).
The credit crisis and resulting financial mess were and remain products of government. For example, George W. Bush went to both the house and the senate twenty-six (26) times, warning them
of the dangers inherent to compelling banks to make loans to unqualified borrows. The first time he went and formally requested that Fannie Mae and Freddie Mac be regulated more evenly, was on 26th April, 2001. That is Two-thousand-and-one! He sent both formal Presidential Memos and his Treasury Secretary twenty-five more times and said: “We’re headed for a wall at 90 miles an hour and financial disaster.” (I quoted him on a radio program in our city in May, 2001 as we began to build our Sovereign software, which in part, was designed for banks to see how monies lent to businesses was performing – we still use it this way). I warned then: “If people do not stop using their homes like a checkbook, they’re not only going to destroy themselves, they’re going to destroy us all.” (in an on-air debate with new Mortgage lenders that were sprouting up all over the place).
One also has to understand several other things: 1) those derivatives that people vilify actually saved our collective butts – they provide for a means to nationalize value reducing the actual cash out; 2) the credit crisis began when lending ceased that was based upon the sale of packaged loans, AFTER people stopped paying their mortgage payments (many never intended to pay them at all, and instead hoped they could flip homes before they would be compelled to pay a dime); 3) The “notional” value of every call made against Lehman Brothers was only a little over 8 billion dollars – an amount they should have been lent! It was an entirely avoidable bankruptcy; 4) AIG is not nearly as “evil” as they have been made out to be. 120 Billion US dollars were sent through them to insulate Euro-zone banks and make up shortfalls that kept RBS and Deutsche Bank alive and bought the EU (ECB) enough time to get their stuff together – and do note, those were hedge funds and derivatives that were being insured – exactly what they were designed to do and in part, what AIG’s business was designed to do.
I’ll debate these issues with anyone here. Let’s just leave the politics out of it and let the facts speak for themselves.
For example, yes, Obama spent, BUT NOT ENOUGH! He needed to replace lost consumer spending with Govt. spending. He needed to spend twice the amount he did. Gonzo is right about that and if you understand things, you'd see why. What Obama has failed to do, as Bush also failed to do, is simply tell people the whole truth. Now it is too late.
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#27 By
1896 (68.153.171.248)
at
6/5/2010 5:52:23 PM
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#26: Iketchum: Actually "Swaps" have been around well before 1870's:
They were already used in Medieval and Renaissance time but...... even then they were highly criticized because so prone to be "abused": in the 17th Century, in his famous "Confusion De Confusiones", Josè Penso de la Vega, a Portuguese Jew living in Amsterdam which at the time was one of the main centre of trading, ridicule such complicated and abstrused instruments.
in 1733 after a big scandal in Great Britain a new law forbid the use of Options and Futures at the London Stck Exchange. Note that in the US the future market was very active since the beginning of the 19th Century but...... for agricultural products.
The proliferation of these trading instruments in the financial sectors began after 1971 when the end of US$/Gold parity, the end of the fixed exchange rate, unstable interest rates and inflation.
When the value of all these interconnected and more and more complicated contracts exploded was with the third millenium: consider that in June 2004 the "Over the counter" market was valued around US$220,000 Billion, June 2007: US$430,000 Billion.
Good luck to whoever will try to fix this mess.....
Anyway the bottom line is that "Derivates", "Swaps", "Future" etc. etc. are not evil instruments "by nature" but if people and insitutions are not restrained in the way these instruments are used they become able to disrupt the World economy.
This post was edited by Fritzly on Saturday, June 05, 2010 at 19:11.
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#28 By
92283 (70.67.3.196)
at
6/6/2010 10:41:00 AM
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#25 "Obama is guilty of preferring stimulus spending ..."
Yes. And debt as a % of GDP is now heading for over 100%. Not good. Private sector job creation has tanked to almost 0. A disaster. Remeber when he promised unemployment would not go above 8%.
"By the way, aren't credit rating agencies also to blame?"
Lots of blame to go around. But without the bad mortgage bubble, it would not have been the disaster it is.
The mortgage bubble is the key, and unfortunately as Japan shows, recovering from such a bubble may take decades.
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#29 By
16797 (99.236.143.109)
at
6/6/2010 11:35:01 AM
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#28 "Yes. And debt as a % of GDP is now heading for over 100%. Not good. Private sector job creation has tanked to almost 0. A disaster."
And what were other options he had?
1. No stimulus spending. Well, guess what? World has already tried that option - it is called the great depression. Yeah, that would be better, right.. EVERY major economy in the world had agreed to stimulus spending, so please..
2. Bigger stimulus spending, as Lloyd said. but guess what? No votes in the senate for that. He was able to get this stimulus through with just 2 (or was it 3?) votes from republicans and bigger stimulus bill would certainly have failed.
So what was he supposed to do? You know of another option? Please tell world about it.
"Remeber when he promised unemployment would not go above 8%."
I do. But I don't think he, or anybody else, had idea of how bad things were.
I think his biggest mistake was to put Summers and Geithner in command. Those guys are simply incompetent. Summers lost all his credibility long time ago (late 90s) and Geithner never had any :-)
I don't know what the solution is and I agree it may take decades to fix this, especially when we now know that tux cuts for rich that Bush pushed through (in 2001 I think) resulted in 0 net jobs created during 2000-2009. So that did not work well either - it did not create ANY jobs.
Stimulus bill or not, I think that US is, sooner or later, simply going to have to introduce higher taxes or even something like VAT to deal with debt.
You simply can't run all those wars, maintain empire all around the world and have all those gvmt programs (with population where life expectancy increases, etc) and expect to NOT have taxes increased.
Or one could try to cut military budget. Good luck with that :-)
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#30 By
92283 (70.67.3.196)
at
6/6/2010 7:00:05 PM
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#29 I lean towards John Cochran's view:
" The economy can recover very quickly from a credit crunch, left on its own, with stable, low-taxes, pro-growth policies in place.
It doesn't need trillions of dollars of government spending to get it going again. That leads to grease. If stimulus spending led to prosperity, borrowing trillions of dollars and spending it on social programs or government employees, Greece would be the richest country in the world, and not one that's about to default on its debt. That's our danger."
"A trillion-and-a-half dollars is a lot of money to spend on maybe even a million jobs"
http://www.pbs.org/newshour/bb/business/jan-june10/stimulus_02-17.html
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#31 By
3746 (72.12.133.246)
at
6/6/2010 7:02:14 PM
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If the rest of the world would like to see how to run a banking system send some guys over to Canada. Last to enter the recession first to exit. Economy doing okay. No bank in Canada needed to be loaned any money during the credit crisis. While the rest of the world was acting like idiots Canada stuck to tried and true methods.
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#32 By
92283 (70.67.3.196)
at
6/6/2010 10:21:59 PM
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#29 "especially when we now know that tux cuts for rich that Bush pushed through (in 2001 I think) resulted in 0 net jobs created during 2000-2009"
What do you mean by "0 net jobs"? Is that some weird left wing talking point?
Maybe those tax cuts saved millions of jobs without costing 1.5 trillion dollars?
The US unemployment rate averaged 5.3% under Bush's 8 years in office. And he had 9/11 to cope with. It peaked at 6% in 2003 and dropped until late 2007 (isn't that when Democrats took over congress?).
http://data.bls.gov/PDQ/servlet/SurveyOutputServlet?data_tool=latest_numbers&series_id=LNS14000000
And if you change the above graph to 1980 to 2010, Bush's years look tied for the best 8 year period which is pretty darn good.
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#33 By
143 (96.28.66.92)
at
6/6/2010 10:58:10 PM
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It does sound like the people responsible for wrecking the car are now complaining about the repair bill.
damn you grammar!
This post was edited by donpacman on Monday, June 07, 2010 at 18:17.
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#34 By
23275 (199.227.138.196)
at
6/6/2010 11:14:39 PM
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#31, Canada benefits very greatly from its proximity to and association with the US.
DEEP tax cuts extended courtesy of US tax payers and very favorable trade policies subsidize the Canadian govt. and people. We could talk about defense spending and the sea and air routes that America provides for, that add to the benefit, but I doubt many people will embrace that. So, we can stick to things like steal, where on one side of the river, a vibrant steal industry was moved across the river into Canada to prop up the Canadian economy at a time when Canada needed us to fall on our swords and take one for them to quiet down the separatist movement in Quebec.
I like Canada, don't get me wrong, but please do embrace the facts that provide the country with a lot of benefit - for example.... the number one source of foreign oil into the US? It comes from Canada and we buy it from there at rates far higher than we would buy it on the open markets. Oh... and US firms, drilling at very steep and long angles drill into our arctic reserves for us. Same crap we did to the Iraqis from Kuwait in the late 80s and early 90s, which led to Gulf War I.
As I said, we can debate issues, but we'd best be prepared to face the facts. Personally, I'd shred the treaty of Ghent, as the Canadians routinely wipe their backsides with it and rub it in our noses. For example, as the cold war ended, and we were chased out of the arctic circle after having paid for every bit of it, they kept the F-18's we had up there to keep from having to fulfill their purchase contract for their own. The American tax payers picked up that tab and the country then used the savings to fund the transfer of US auto plants from Michigan and Ohio into new facilities up north. NAFTA's first steps were not good ones for US auto workers, but terrific for Canadians.
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#35 By
16797 (99.236.143.109)
at
6/6/2010 11:20:19 PM
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#32 It's about job growth actually. Here:
http://www.washingtonpost.com/wp-dyn/content/article/2010/01/01/AR2010010101196.htm
There has been zero net job creation since December 1999. No previous decade going back to the 1940s had job growth of less than 20 percent. Economic output rose at its slowest rate of any decade since the 1930s as well.
...
etc.
And he had 9/11 to cope with
(Why did he have 9/11.. helloooo?)
And coped he did.. by invading country that had nothing to do with it. Bravo, maestro, bravo.
"dropped until late 2007 (isn't that when Democrats took over congress?)."
So they did. And? Was Bush still not in White House... and his signature still required?
Man, just compare US economy (or debt) when Bush moved into White house to situation when Obama took over. Enough said.
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#36 By
92283 (70.67.3.196)
at
6/7/2010 1:16:53 AM
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So, bracketed by a recession which he inherited and a a recession at the end, no net job losses?
The best unemployment rate average of any 8 year period in the last 30?
Good times ... good times ... compared to whats ahead.
I'll give you 1 good reason why job growth sucked. The Al Gore green nutbars who effective outsourced the jobs of a whole generation. They shipped all those jobs off to Mexico and China and Asia because they wanted green this and green that.
Economic suicide has been the lefties plan for decades. Obama is now delivering the coup de gras. Boom ... a trillion more in debt per year. Another trillion for health care and millions dead when the death panels ration like they do in the NHS.
And even more jobs outsourced where they use coal and power is cheap.
This post was edited by NotParkerToo on Monday, June 07, 2010 at 01:18.
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#37 By
16797 (99.236.143.109)
at
6/7/2010 8:23:20 AM
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36: "So, bracketed by a recession which he inherited and a a recession at the end, no net job losses? "
So... this great recession.. near the end of his term, was it also inherited? Yeah, somebody else was in the office, so nothing he could have done. Just like 9/11...
Good times? Bush years are ... good times??? Hahahah :-)
Death panels? Whatever.
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#38 By
23275 (75.247.22.5)
at
6/7/2010 10:03:15 AM
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The really skeery stuff will happen next year - when as predicted, we see the impact of so much revenue being booked into this year (yeah... can ya believe it?... this year will rock compared to 2011 and 2012).
You see, it is quite simple... where is most wealth positioned? and opposite tax increases next year?
What happens each time the dems do this? The economy tanks and hard.
http://online.wsj.com/article/SB10001424052748704113504575264513748386610.html?mod=WSJ_hp_mostpop_read
"Likewise, who is gobsmacked when they are told that the two wealthiest Americans—Bill Gates and Warren Buffett—hold the bulk of their wealth in the nontaxed form of unrealized capital gains? The composition of wealth also responds to incentives. And it's also simple enough for most people to understand that if the government taxes people who work and pays people not to work, fewer people will work. Incentives matter." - Arthur Laffer
Example:
According to a 2004 U.S. Treasury report, "high income taxpayers accelerated the receipt of wages and year-end bonuses from 1993 to 1992—over $15 billion—in order to avoid the effects of the anticipated increase in the top rate from 31% to 39.6%. At the end of 1993, taxpayers shifted wages and bonuses yet again to avoid the increase in Medicare taxes that went into effect beginning 1994."
Tax receipts will crash in 2011 and I just can't wait for Payroll taxes to go up in 2013, per Obama's schedule of increases... Yummy!
Remember, at its core, socialism works like this: we pretend to work and you pretend to pay us. (e.g., there is no economy).
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#39 By
1896 (68.153.171.248)
at
6/7/2010 11:06:21 AM
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#38: Iketchum please do not insult yourself with these statements a la O' Reilly, you deserves much better: Mr. obama ha s nothing to do with any kind of "Socialism".
Note that I used the word 'any kind" because, as you very well know, words as "Capitalism" and "Socialism" are not a synoymous of a single defined, monolithic philosophy; on the contrary they are used as aggregators of many different concepts and ideas that are also in a state of continuous evolution and rethinking since they were first published in the past centuries.
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#40 By
16797 (99.236.143.109)
at
6/7/2010 11:13:05 AM
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#38 "Remember, at its core, socialism works like this: we pretend to work and you pretend to pay us. (e.g., there is no economy). "
Sounds like Cheney to me:
Cheney to Treasury: "Deficits don't matter"
Former Treasury Secretary Paul O'Neill was told "deficits don't matter" when he warned of a looming fiscal crisis.
O'Neill, fired in a shakeup of Bush's economic team in December 2002, raised objections to a new round of tax cuts and said the president balked at his more aggressive plan to combat corporate crime after a string of accounting scandals because of opposition from "the corporate crowd," a key constituency.
O'Neill said he tried to warn Vice President Dick Cheney that growing budget deficits-expected to top $500 billion this fiscal year alone-posed a threat to the economy. Cheney cut him off. "You know, Paul, Reagan proved deficits don't matter," he said, according to excerpts. Cheney continued: "We won the midterms (congressional elections). This is our due."
A month later, Cheney told the Treasury secretary he was fired.
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#41 By
3746 (72.12.133.246)
at
6/7/2010 12:57:03 PM
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instead of all the comments how about a new forum that doesn't delete your comment when you try and post something. What a piece of crap.
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#42 By
92283 (70.67.3.196)
at
6/7/2010 1:14:01 PM
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#37 "Good times? Bush years are ... good times??? Hahahah :-) "
Again, the average unemployment rate over his 8 years was pretty good. Possible tied by Clinton's 8 years.
Compared to the next 10-20 years, they will be seen as "good times".
"Death panels? Whatever."
NHS Death Panels. There are actually 2. One is the Liverpool Care Pathway that starves you to death when they judge the time is right, and the other is NICE which rations medical care based on costs.
http://www.telegraph.co.uk/health/healthnews/6127514/Sentenced-to-death-on-the-NHS.html
http://dailycaller.com/2010/05/27/death-panels-were-an-overblown-claim-until-now/
"
Dr. Berwick wants to bring NICE-style rationing to this country. “It’s not a question of whether we will ration care,” he said in a magazine interview for Biotechnology Healthcare, “It is whether we will ration with our eyes open.”
Berwick is Obamas pick.
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#43 By
8556 (173.27.246.50)
at
6/7/2010 1:52:53 PM
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And so my fellow jurors, the above clarifies how Apple became more valuable than Microsoft.
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#44 By
92283 (70.67.3.196)
at
6/7/2010 3:02:48 PM
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It is interesting that people are starting to realize that job creation was strong in Bush's terms after the recession was over:
"despite an unemployment high of just 6.4%, more jobs were lost in the first seven quarters of the 2001 recession than were lost in the first seven quarters of this recession.
How is that possible? How could job losses have been worse in 2001 but unemployment so much higher now?
Weak job creation.
The latest Bureau of Labor and Statistics data show that employers have created 8.6 million fewer new jobs this time around than they did almost a decade ago. Heritage Senior Labor Policy Analyst James Sherk estimates that lower job creation accounts for 65 percent of the recession’s decreased employment.
Our nation’s unemployment rate is hovering near 10% not because of record job losses, as Biden suggests, but because of record job non-creation."
http://hotair.com/archives/2010/06/07/video-the-stimulus-failed/
The claim that there was "0 net jobs created" is one of those left wing talking points that hides the fact that huge number of jobs were created during Bush's terms.
I blame Bush's tax custs for creating all those jobs that kept unemployment low,
This post was edited by NotParkerToo on Monday, June 07, 2010 at 15:04.
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#45 By
16797 (99.236.143.109)
at
6/7/2010 3:51:52 PM
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Oh yeah, Bush did such a fine job. So fine that (from Bloomberg.com):
The longest and deepest U.S. economic slump in seven decades has been dubbed the “Great Recession” by the Associated Press. The AP Stylebook Online notified subscribers this month it had added the term as a reference for the downturn that began in December 2007.
I know you're mad at Obama 'cause he's coming to get your gun, but it was not him who was in command on and before Dec/2007. Bush and republicans were.
Enough :-)
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#46 By
92283 (70.67.3.196)
at
6/7/2010 5:19:34 PM
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#45 Darn. I was sure the Democrats shared some of the blame because of the pre-existing mortgage crisis and because they had a majority in the House and Senate starting in January 2007.
Even so, with a nasty recession starting when Bush took office and an even nastier one the last year he was in office, he still didn't lose any jobs (net).
I'm mad at Obama because he essentially took a wounded economy and shot it in the head with a double barrelled shotgun by taking on trillions of debt that cannot be repayed -- if ever -- for decades.
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#48 By
16797 (99.236.143.109)
at
6/7/2010 6:50:13 PM
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Just one thing: those Bush tax cuts for rich that you praise - unpaid for. Deficit spending.
(Btw, even if dems got control in the house and senate in january - it doesn't change much: they still needed president's signature to do anything, etc. Besides, the fact that republicans lost the house, senate and then white house clearly speaks of who people think was responsible..)
This post was edited by gonzo on Monday, June 07, 2010 at 19:18.
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#49 By
92283 (70.67.3.196)
at
6/7/2010 9:52:13 PM
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#48 It depends on whether you think 8.6 million jobs created after the 2001 recession was worth it. It seems that tax cuts were significantly cheaper per job created than the spendulous program which has created few jobs and lots of pork for pet lefty projects.
Tax cuts may have been the right choice. Give small businesses an incentive to hire. As opposed to Obamacare and the repeal of the Bush tax Custs which will kill job creation even more in 2011 and on.
"they still needed president's signature to do anything"
Alternatively, the President needed legislation to sign. From Senators like ... Obama. What was the legislation he was famous for ....
... thinking ...
.... cricket ... cricket ... cricket.
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#50 By
16797 (99.236.143.109)
at
6/8/2010 8:01:46 AM
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#49 Oh, so all those years until 2007 there were no signs of housing bubble and financial and deficit crisis therefore republicans did nothing even though they were in power? Yeah, whatever.
They were too busy with "mission accomplished" and such.
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