Felix Salmon

Chart of the day, Apple valuation edition

By Felix Salmon
November 28, 2011

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Andy Zaky at Bullish Cross has a great post on Apple’s valuation, showing the astonishing degree to which the market is discounting the value of a dollar of Apple’s earnings today, compared to just two years ago. Back then, it was worth $32; now, it’s worth just $13. In the eyes of the market, Apple earnings are worth less than those of Cisco, Comcast, IBM, or AT&T, and are worth just 13% of the earnings of Amazon.

Chart of the day, Morgan Stanley bailout edition

By Felix Salmon
November 28, 2011

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Ladies and Gentlemen, this is what a lender of last resort looks like. What you’re looking at here are three lines. The black line is Morgan Stanley’s market capitalization, which tends to hover in the $40 billion range but which fell as low as $9.8 billion in November 2008. The orange line is the amount that Morgan Stanley owed to the Federal Reserve on any given day — an amount which peaked at $107 billion on September 29, 2008. And the red line is the ratio between the two: Morgan Stanley’s debt to the Federal Reserve, expressed as a percentage of its market value. That ratio, it turns out, peaked at some point in October, at somewhere north of 750%.

The problematic charitable-donation tax deduction

By Felix Salmon
November 28, 2011

David Kocieniewski has a long article about Ronald Lauder as sophisticated consumer of tax-avoidance advice, who has managed to become worth somewhere north of $3 billion even as he’s given away hundreds of millions of dollars to charitable causes. (In 1988 he was worth less than $250 million; he inherited a lot of money from his mother in 2004, but today his stake in Estee Lauder constitutes only about one fifth of his net worth.)

Europe’s insoluble problems

By Felix Salmon
November 25, 2011

Mohamed El-Erian is calling for massive recapitalization of the banking system:

The global financial system is being refined “day in and day out,” El-Erian said, and as a result the balance between public and private is shifting and regulation is altering. “This is not being done according to some master plan,” but in reaction to a series of crisis management interventions.

Counterparties

By Nick Rizzo
November 25, 2011

A really good overview on Angela Merkel saying “nein” to euro bonds — Spiegel

Counterparties

By Nick Rizzo
November 23, 2011

Izzy Kaminska has an intriguing post on what happened with today’s bund auction — FT Alphaville

Chart of the day, tech-stock edition

By Felix Salmon
November 23, 2011

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Paul Kedrosky reckons that Groupon’s the worst-performing internet IPO since Netflix, in 2002. He’s wrong: Groupon is doing even worse than Netflix did. It’s now trading at 85% of its IPO price; Netflix, by contrast, was still a tiny bit above its IPO price at this stage in its volatile history. (The chart above shows how Netflix performed in its first year as a public company, compared to its IPO price.)

The lessons of “Margin Call”

By Felix Salmon
November 23, 2011

Jake Bernstein, in his mash note to Margin Call, is right to see the moral heart of the movie in a speech by Paul Bettany’s character, Will Emerson. (Warning: both Bernstein’s piece and this blog post contain spoilers.)

Why Apple’s customers cripple its user experience

By Felix Salmon
November 23, 2011

Apple products have always cost more than the equivalent products elsewhere. It’s one of the reasons that Apple has historically had very high brand loyalty and very low market share — a classic luxury-good combination. But now that Apple has become a mass-market brand, it’s reaching millions of sensible people, who like to save money. And that, in turn, causes an interesting tension.