Gyroscopic Investing

The student run portion of my school's endowment (I am one of the portfolio managers) just bought some AAPL this morning. As long as the company doesn't royally screw up their beautiful position in they market we should do well. I think its at that kind of pricing.

MediumTex wrote:Apple owns the tablet space, the music player space, the cool computer space, the cell phone space, and the online music purchase space, just to name the big parts of its business.  It's a pretty impressive company with very loyal customers.

I am admittedly not an Apple customer.  I have never owned any of their products, although I've tried them numerous times and always found them largely overrated and over-restrictive. 

Apple may be a strong company, but mainly because they cling tightly to their monopoly and depend on the cult-like devotion of their customers because they can't compete on variety or price.  For instance, if you want an iPhone, you can buy a... welll... an iPhone, and you'll pay... well.... whatever Apple wants you to pay.  If you want an Android, you have dozens and dozens of choices, all of which are a fraction of the cost of an iPhone because they compete against one another.  I took a quick survey of the people in my department at work, and 80% have an Android. 

We'll see where they're headed without Steve Jobs, but the technology space is incredibly fickle and customers will quickly shift to a new platform or manufacturer if they see a benefit to doing so.  This makes Apple ripe for competition and highly vulnerable, imho.  Cost is a major factor that is eroding iPhone sales, just as it did with PCs.  iMacs start at $1,299, whereas you can get an entry-level Windows PC for as little as $300.  I'm guessing this is why I've never worked at a company that used Macs, and I only saw one computer lab in graduate school that had Macs in it (my Masters is in IT, so I saw a lot of computer labs).  And tablets are largely unusable for anything other than games or casual web browsing (ever try typing on that virtual keyboard?  Yikes.)

I'm happy to limit my exposure to APPL to what's in my index funds, thank you very much.)

rocketdog wrote: I'm happy to limit my exposure to APPL to what's in my index funds, thank you very much.

I can appreciate discipline 

IT professionals are rather far from being in Apple's target market, so given the disproportionate number of IT/engineering folks I know are here, our personal responses may be a bit skewed. Perhaps a more appropriate question might be, "Do any of your non-technical family members or friends use Apple products?"

Here has been the experience with purchasing Apple products in my household.

Prior to three years ago, we had zero Apple products in our house, apart from an old Macintosh in the attic.

In the last three years, our household has purchased the following Apple products:

2 MacBook Airs
3 IPads
4 iPod Touches
4 iPhones
1 Apple TV
1 AirPort Extreme

So far, I have enjoyed all of these products and have found them to be well designed and well built and I will probably continue buying them as newer and better technology and features become available.

With respect to the MacBook Airs especially, I find them immensely easier to use than the PC based computers they replaced.

That's all JMHO, of course, but I don't think that my situation is all that unusual.

I used to think that the whole Apple thing was a little overblown, but when I started buying and using the products I came to appreciate Apple's leadership in basically all of its product lines.

MediumTex wrote: Do you own any Apple products?

If so, which one(s)?

If you do own Apple products, do you see yourself buying more in the future?

I'm just curious.

I have past experience with Mac, iPod, iPhone, and iPad products, but I don't currently own any Apple products and don't see myself purchasing any in the future. 

Most of my friends and family have iPhones and/or iPads. A couple of them have Android devices, but the vast majority are Apple users.

I bought my first Apple product a couple of months ago: an iPhone 5. It's a great phone, and I love it. It has a solid, quality feel to it--unlike most Android devices I tried holding in my hand--but at the same time isn't too heavy. Its retina display is gorgeous, and the simplicity and elegance of its software interfaces are part of what makes it such a pleasure to use. I'm an engineer, so I understand the urge to tinker and control. But I also appreciate simplicity, and my iPhone 5 is wonderfully simple.

Whether Apple's stock rises or continues to fall, I have a feeling the company will continue to create high-quality products and maintain customer loyalty for years to come.

rocketdog wrote: And tablets are largely unusable for anything other than games or casual web browsing (ever try typing on that virtual keyboard?  Yikes.)

Re tablets:  Don't forget--listening to music, watching videos (including mobile TV),  reading books, taking pictures, Skypeing.  I use mine to read books and .pdf files on the train commute to NYC, and sometimes to watch videos I've downloaded from the web.

With an iPad, you aren't limited to the virtual keyboard; there are plenty of keyboards you can buy to hook up to it.

MediumTex wrote: I used to think that the whole Apple thing was a little overblown, but when I started buying and using the products I came to appreciate Apple's leadership in basically all of its product lines.

Wow, you groupie!  The last Apple product I used was, well...  the Apple IIc!

Yet, I have noticed over time that Apple really, really focuses strongly on the user experience even if it involves a bit a lot of dumbing down.  As I've gotten older and more fed up in dealing with poor programming and/or design decisions from what seems to be increasingly cheap, slave labor programmers or manufacturers (aka Cheap Chinese Shit), it makes Apple seem like the proverbial promised land.  Isn't it about time that technical products should work like they're supposed to (and used to), rather than forecing everyone into being a beta tester???

MachineGhost wrote:
Yet, I have noticed over time that Apple really, really focuses strongly on the user experience even if it involves a bit a lot of dumbing down. 

Not everyone had the time, energy, aptitude, or desire to do programming to get the results out of their spreadsheet or document they are trying to achieve. And corporations have large IT departments and Help Desks to answer the constant questions and to perform the file repair (etc.) on PCs.

Before I made the switch to using Macs, I had to spend as much time debugging, delousing, and searching C: and A: drives for gibberishly named files on my home PC as I spent actually writing and creating documents.  Every software had its own key commands.  So switching to Macs increased my productivity, even though parts of the experience were "dumbed down" by uniform commands, the desktop innovation, relatively strong firewalls, and file names that actually have meaning.

As I've gotten older and more fed up in dealing with poor programming and/or design decisions from what seems to be increasingly cheap, slave labor programmers or manufacturers (aka Cheap Chinese Shit), it makes Apple seem like the proverbial promised land.  Isn't it about time that technical products should work like they're supposed to (and used to), rather than forecing everyone into being a beta tester???

I agree with  you about this.  I believed someone sued Microsoft over this issue many years ago, and it was decided in Microsoft's favor as long as they included all that legalese on the box or envelope that holds the software disk, and you have to agree to it before breaking open the seal.

I feel the same way about anti-ID theft (among other internet/web/social problems).  If a website is designed so that credit cards, emails, passwords, and other identity points are easily hacked and compromised, that's a defective or incomplete website that should have never been unleashed on the public. 

smurff wrote: With an iPad, you aren't limited to the virtual keyboard; there are plenty of keyboards you can buy to hook up to it.

I use my Apple bluetooth keyboard on my ipad and iphone all of the time.

When I go to client meetings where I will be taking a lot of notes, I just use my iphone and bluetooth keyboard an email the notes to myself and other participants when we're done.

The Photon web browser app lets you watch flash videos on your Apple device, so that base is covered as well.

Pointedstick wrote: IT professionals are rather far from being in Apple's target market, so given the disproportionate number of IT/engineering folks I know are here, our personal responses may be a bit skewed. Perhaps a more appropriate question might be, "Do any of your non-technical family members or friends use Apple products?"

None of my immediate family uses Apple products.  My parents used to use an iMac, but when the one they had sh*t the bed they decided to switch to a PC for less than half the price. 

My wife's family has a few Mac devotees in it, so I get exposed to Apple products from time to time when they visit.  They're slick looking products, no doubt about it, but I just can't see the added value for the price you pay. 

Funny story:  my boss was recently given an iPhone as a gift.  On Monday she called me into her office to help her figure out how to turn her ringer back on.  Somehow she had turned it off by accident, and another employee (also an Android user) had tried to help her to no avail.  I told her to hold on, then went back to my desk and did an Internet search.  I came back with the solution: flip the switch on the side.  She was incredibly embarrassed that she had spent almost an hour trying to find the software setting that turned her ringer back on, when it was actually a hardware solution and not a software solution.  Most Androids, in case you didn't know, have only 2 external controls: one for powering on/off, and one for volume.  All else is handled by the software, as one would expect (as evidenced by the lack of intuitiveness experienced by my boss). 

MediumTex wrote:I used to think that the whole Apple thing was a little overblown, but when I started buying and using the products I came to appreciate Apple's leadership in basically all of its product lines.

Hey whatever works for you.  I've only used Macs in a hands-on capacity twice:  once when my parents had an iMac, and once during a course in graduate school where they forced us to use Macs for one class. 

My parents' iMac was trouble from the beginning.  It was touted as "15 minutes from box to Internet".  I helped my parents get it set up, and we followed the QuickStart directions religiously.  No go.  After wrestling with it for maybe an hour, we finally broke down and called Apple Support.  It took the tech another 30 minutes or so to get us online.  When questioned, he said that "sometimes it happens".  Swell.

In graduate school, I was skeptical but open-minded about using a Mac, especially after our professor touted their benefits.  The problems quickly manifested themselves.  Where was the right-hand mouse button, arguably the single-most useful feature of a PC?  (Sorry -- Macs don't have those.)  Other problems abounded when trying to write programming code, as the bundled software was sub-par in most respects.  FTPing files on a Mac is a real adventure... as long as you can figure out why there are 2 files associated with every document!  Partway through the course, I actually heard a fellow student behind me remark at one point, "This is torture", referring to our forced use of the Mac. 

I gave it an honest try for the 11 weeks of the course, but it was a true relief to get back to a PC I must admit.  I should also add that I am not a Windows apologist.  These days I'm experimenting with Linux more and more, as I don't like the direction in which Microsoft is taking Windows.  I've been using Windows since 3.1, and XP Pro is still the "sweet spot" in terms of OSes, imho.  Ah, the good old days... 

I'm no Apple fanboy, but many of those stories are years out of date. Macs have come with multi-button mice for years, and the "double file" issue is a relic of the Mac OS 9 filesystem, which has been dead and buried for a decade. That antiquated, funny-looking iMac from 15 years ago was a very different machine from the very polished products you can buy today. I'm a huge fan of Linux Mint which is my daily OS, but I have to say that Macs and OS X have come a long, long way in the last decade.

rocketdog wrote: Re tablets:  Don't forget--listening to music, watching videos (including mobile TV),  reading books, taking pictures, Skypeing.  I use mine to read books and .pdf files on the train commute to NYC, and sometimes to watch videos I've downloaded from the web.  With an iPad, you aren't limited to the virtual keyboard; there are plenty of keyboards you can buy to hook up to it.

My thoughts:

Listening to music:  My wife and I both use a stand-alone Sandisk MP3 player.  Costs about $35 and holds 8 GB.  About the size of a match box, weighs maybe an ounce, has an OLED screen, and fits nicely in a shirt pocket or clips to your sleeve.  I wouldn't even use my Android phone to listen to music -- too big and heavy. 

Watching videos:  I have no need (or desire) to watch videos on a screen less than 15".

Reading books:  LCD screens are backlit, which means they're torture on your eyes.  If you want an e-reader, be serious and get a Kindle or Nook or other reader that uses e-ink. 

Taking pictures:  Seriously?  With an iPad?  Or any other tablet?  Come on.  Funny story:  I went to an air show a couple of years ago where the Blue Angels performed.  Everyone had cameras and camcorders to capture their aerial acrobatics.  And then there's some tool out there holding up his iPad to take video as the planes rocketed past us.  Really dude? 

Keyboards:  Yes, I have a keyboard for my Android tablet.  We bought the tablet for my wife to use when cooking in the kitchen, sans keyboard (so ingredients don't get caught in the keys).  The tablet's nice for that, and for bringing with us when we travel on occasion, but for day-to-day use we swear by our laptop.  17" screen, full keyboard with numerical pad, simply no substitute. 

Pointedstick wrote: I'm no Apple fanboy, but most of your stories are many years out of date. Macs have come with multi-button mice for years, and the "double file" issue is a relic of the Mac OS 9 filesystem, which has been dead and buried for a decade. That antiquated, funny-looking iMac from 15 years ago was a very different machine from the very polished products you can buy today. I'm a huge fan of Linux Mint which is my daily OS, but I have to say that Macs and OS X have come a long, long way in the last decade.

The double-file issue I experienced was around 2005-2006, so not quite a decade.  Still, I'm sure you're right, but the problem is that the damage was done and I was turned off on Apple products from that point forward.  If I found Windows miserable to use I'd give Apple another go, but I'm happy as a clam using Win XP Pro.  I run it in VMWare, along with Win7 and even Win98 for some legacy programs.  I think I might even still have a Win95 VM lurking about somewhere. 

I like the look of Linux Mint but it never worked quite right for me.  I've tried every single Linux distro I could find, and I prefer Ubuntu.  I might give Mint another go -- maybe they've worked out the kinks since I last tried it.  I was sure disappointed when I couldn't get it to work right the first time a couple of years ago. 

rocketdog wrote: Windows.  I've been using Windows since 3.1, and XP Pro is still the "sweet spot" in terms of OSes, imho.  Ah, the good old days... 

I disagree.  Server 2003 was the sweet spot.  Faster and better in every way!  I still use it on an aging Celeron I laptop with Pale Moon and MailNews.

rocketdog wrote: Taking pictures:  Seriously?  With an iPad?  Or any other tablet?  Come on.  Funny story:  I went to an air show a couple of years ago where the Blue Angels performed.  Everyone had cameras and camcorders to capture their aerial acrobatics.  And then there's some tool out there holding up his iPad to take video as the planes rocketed past us.  Really dude? 

I really dislike this increasing obsession with capturing or recording every event.  It strikes me as the height of sheer self-absorbed, egotistical selfishness.  What is the point of going out to see anything when everyone has already recorded it and posted it on Facebook or Photobucket for the entire world to see?  The sheer irony doesn't seem to occur to all these people, that maybe not everyone else gives two shits about what they experience and that maybe they would like to experience it for themselves without spoilers.

Oh wait, I forgot we never really leave high school....  I'll go back into my neo-Luddite man cave now.

MachineGhost wrote: I really dislike this increasing obsession with capturing or recording every event.  It strikes me as the height of sheer self-absorbed, egotistical selfishness.

In my opinion, it's almost impossible to really experience an event if you are preoccupied with "capturing" it on video.

Imagine going out on a first date and attempting to film the whole thing "because you wanted to be able to show your grandkids the first time their grandparents met."  That would be a dumb thing to do IMHO, and yet people routinely do this sort of thing in similarly important situations that are meant to be experienced, not documented.

MachineGhost wrote:

rocketdog wrote: Windows.  I've been using Windows since 3.1, and XP Pro is still the "sweet spot" in terms of OSes, imho.  Ah, the good old days... 

I disagree.  Server 2003 was the sweet spot.  Faster and better in every way!  I still use it on an aging Celeron I laptop with Pale Moon and MailNews.

I have no answer for that, since I've never used Server 2003.  If I come across an install disk someday, I'll have to throw it into VMWare and give it a whirl. 

MachineGhost wrote:I really dislike this increasing obsession with capturing or recording every event.  It strikes me as the height of sheer self-absorbed, egotistical selfishness.

I'm with you there!  Although, I am an amateur photo enthusiast (my undergrad degree was in Cinema & Photography), so I like taking vacation photos and such.  But I keep it in check, partly because I like to enjoy the experience, and also because lugging around a DSLR can become aggravating after a point.  I'm just as happy tossing a point & shoot in my pocket so I can quickly whip it out to snap a few photos here and there as needed. 

MediumTex wrote:In my opinion, it's almost impossible to really experience an event if you are preoccupied with "capturing" it on video.

I imagine that someday in the future we'll all be wearing mini-cameras on our clothing, or in our glasses, or there will be some other technology that records everything our eyes or brains process.  There's actually a 2004 movie with Robin Williams along these lines called "The Final Cut". 

This brutal correction is so tempting. Today's drop was spurred by an inventory glut for one of their suppliers, indicating that Apple may be operating below prior internal projections... Still it is just so cheap.

However, it is impossible to forecast where they will be 10 years from now. I definitely can appreciate why many investors prefer more predictable businesses such as Coke (KO).

With that said, I think a long position in Apple could be a tempting speculation  .

melveyr wrote: This brutal correction is so tempting. Today's drop was spurred by an inventory glut for one of their suppliers, indicating that Apple may be operating below prior internal projections... Still it is just so cheap.

However, it is impossible to forecast where they will be 10 years from now. I definitely can appreciate why many investors prefer more predictable businesses such as Coke (KO).

Honestly, Apple is starting to look appealing solely as a dividend play.  The 2.5% dividend looks to be VERY safe and you have an easy upside of over 100% while collecting that dividend.

When you look at Apple's P/E and compare it to some of the other high profile tech companies, it's pretty cheap even if its growth does slow.

Apple just slipped below $400, losing over 43% of it's value since September.