Cash is king:

And so Apple today uses its cash to buy parts in huge quantities. Lately this has mainly meant buying flash RAM and iPhone displays in amounts that move whole markets and guarantee Apple the lowest prices anywhere. This is important: in an era where interest rates on idling cash are averaging one percent, Apple is using its cash to get 15-20 percent discounts on parts. That’s exactly like earning a 15-20 percent interest rate.

All told, about $7 trillion of shareholders’ wealth — the gains of the last six years — will be wiped out in a year marked by violent market swings.

via NYTimes.com.

I thought I would be diversified with international and emerging markets funds, but the decline of the U.S. markets also spread around the world. Even “safe” bonds may be in trouble. I can only imagine the nervousness of those holding bonds with GM.

I posted on this thread on post 25:

I have to chime in on the discord regarding the Brainiac decision to remove the one page overview of one’s portfolio. This was a quick and easy way to review holdings over multiple accounts, and now it’s gone! Please bring it back or if you want to get fancy, create an AJAX interface that allows one to expand all the accounts at once. Who’s the person or group responsible for this “update”?! Did they ever think to ask Quicken customers how they use the online portfolio?! Having to click so many times goes against the grain of even basic user interface design.

I was so angry when I tried to check my Quicken one page online portfolio, and it was missing. I don’t have all day to click through each of my accounts to see my holdings!

What’s the worst thing that could happen if Paulson held on to his Goldman stock? It’s possible that a government in which the treasury secretary had a gigantic stake in Goldman might recklessly cut marginal income taxes on the very rich so that he and his fellow executives could keep more of their bonuses. Or he might push to cut income taxes on capital gains and dividends so that Goldman employees and clients would pay fewer taxes. He could help enact legislation to reduce and ultimately eliminate the estate tax so Goldman’s private banking clients would be able to pass on as much cash to their heirs as they want. Why, such an administration might run up massive deficits so that the bond desks of Wall Street firms like Goldman would have plenty of material to buy and sell! Oh, wait—the Bush administration has already done all that.

I predict that Apple will settle on 64-bit Intel processors ASAP (with FireWire 800 please), and at that time will announce a product similar to Boot Camp to allow OS X to run on bog-standard 32-bit PC hardware, turning the Boot Camp relationship on its head and trying to sell $99 copies of OS X to 100 million or so Windows owners.

Will Apple really do this? Won’t it cannibalize their hardware sales? That would make a good plot twist though.

This will be big this upcoming Christmas since Microsoft Vista won’t be coming out until after the holiday season. Buyers looking a for a new computer will be able to purchase the best of both worlds (Windows for games and OS X for nearly everything else) with just one computer.

Praise the gods of Kobol that Lasseter axed Toy Story 3. Toy Story 2 was a great sequel, but a third movie would have done nothing to further the characters or the plot. The only thing it would have been good for is as another monster merchandising opportunity for Disney.

1. OS X. There is no better consumer operating system out there at the moment. I’m talking about stability, security, UI, ease of use, and an open source backend. As Vista’s release gets pushed farther back (there’s even a security alert for Vista!), OS X looks better all the time. I love Windows XP for games, but for everything else, I would use an Apple and OS X. Regarding OS X as a server, the Apple site says it best:

Mac OS X Server gives you everything you need to provide standards-based workgroup and Internet services — without the complexity of Linux or the cost inherent in other UNIX-based solutions.

I decided to go with Macintosh servers before OS X, and things looked bad for awhile with the limits of pre OS X operating systems, but I’ve been very happy with the stability and ease of use of OS X as a server operating system. What’s very nice is that I can use the vast library of open source programs on OS X.

2. Intel Macs. Intel has had its problems lately – especially with the superiority of AMD’s chips, but Intel has more fabs and an R&D department that can’t be discounted despite some recent setbacks vs. AMD. The relatively quick release of the Intel iMacs and MacBooks is a great sign that the transition to Intel chips will go smoothly. The roadmap for Macs looks a lot better now with Intel behind the brains of the Macs. The news that Apple won’t prevent the installation of Vista also means that Mac users can have their cake and eat it too, either with a dual boot Mac that can run OS X and Vista without any speed penalties or a Vista emulator running in OS X that should run at very high speed.

3. iPods. Apple owns the market, and iPods are a product that people can replace on a more frequent basis than computers. Apple doesn’t sit on its laurels in terms of iPod updates, and I can see people with multiple iPods for different purposes or just because they want the newest one with the latest features. The barrier to purchase is lower because the pricing is a lot lower than computers or older iPods.

4. Media opportunities. iTunes is a great interface for downloading and managing music and more recently, video content. From what I’ve read, Apple doesn’t make too much off iTunes or content downloads, but I think of the future and the possbilities of what Apple could control in terms of media content and the regular incremental revenue they could make off media downloads.

5. Steve Jobs. He is a business and media superstar. This guy pushes for excellence and he gets things done. Whatever one says about Apple, with Jobs at the helm, you can never say Apple is a boring company. With Jobs at the top and a culture that pushes the best, I expect some surprises down the line that could easily push Apple past the present products and technologies that analysts and investors think about these days.