
Apple’s Piggybank Earns Less Than Savings Accounts - lotusleaf1987
http://www.businessweek.com/news/2010-11-02/apple-s-piggybank-earns-less-than-savings-accounts.html
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alnayyir
Clearly Apple has no idea what they are doing and should take their
investment/M&A advice from the peanut gallery.

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SkyMarshal
It was actually a good article, despite the flamebait title and first two or
three paragraphs. It covered the reasons investors want Apple to seek higher
returns on their cash horde, along with the (good imho) reasons Apple has for
being risk-averse with it. Worth a full read.

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alnayyir
I don't see anything wrong with Apple maintaining this much cash, it has
serious strategic (albeit unquantifiable) value. Who could outbid them if they
saw a serious opportunity?

One of the best ways to maintain a strong lead is to have the cash necessary
to dispose of the competition at will.

What's the alternative, bankrolling dipshit* startups as an expensive way of
handling recruiting ala Google?

*I jest, don't freak out and get into yet another argument with me, I beg you.

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SkyMarshal
Oh I 100% agree with you. I think the idea in the financial press/industry
that a cash stash like this must _always_ be put to work earning some
measurable ROI is short-sighted, fallacious, herdish-thinking, and completely
blind to the fact that by not risking it, Apple is making an unmeasurable but
valuable return.

It is insurance, a hedge against uncertainty and the worst case scenario, a
psychological edge where they never have to worry about losing the company and
can focus their attention and energy elsewhere (invaluable imho).

With Foreclosuregate clearly demonstrating that the US banking system is still
in tatters even after trillions in Govt. stimulus and Fed backstops, and QE2
and international currency wars coming up, I could go on and on about the
invaluable but unmeasurable ROI of conservative management of that stash in
volatile times. In a nutshell, not losing money is often a better strategy
than chasing returns. It may not be 'actionable', but it is wise.

I just meant by my comment to point out that the article doesn't argue for one
position or the other, but seems to fairly cover the basic arguments of both.
Judging by the title, I thought it was going to make a case for Apple seeking
higher risk/return, but it didn't.

