Perhaps jrgosta and Apple][ put their entire life savings in Apple stock and bet on AAPL hit $500. They will say anything to keep the day of reckoning when AAPL dip below $300 away.
That's as silly and amateurish as what they are saying.
That's where the logic fails. If the stock price is to be based on an expectation of future earnings, then the blowout $37 M guidance given by Apple for the 4th quarter should have increased the stock price, not decreased it.
Har! Logic!
What if the expectation was that the guidance would be $40M?
Do you mean iPhone 4 or iPhone 4S? I'm sure there's a lot of demand in Thailand for iPhone 4S. Scalpers I don't think have enough to supply Thailand to the level that everyone is happy with enough iPhone 4S.
4, not 4S. There are lots of demand but they are still finite numbers. The real limits of demand was price though. 4 came out in Oct 2010 with ฿23,000 for 16GB model. ฿18,000 used.
For Thailand market, ฿19,000 turned out to be a magic number of threshold price Thai buyers are willing to pay, be it cash or 0% interest over 10 months. Samsung Galaxy S2 arrived with that number and basically set the price ceiling here. BB Torch 9860, Bold 9900 and HTC EVO 3D came in at ฿20,000 and now gone. Unbelievable, but it is.
The supply issue only exists in 2010. From Jan 2011, so many scalped iPhone entered a country that every gray market shops have them on cash and carry basis since Feb. Even today you can get one just put the cash down, like so. There are THAT many.
I do not know if 'official' iPhone 4S can crack it with 4GB memory for ฿19,000 and 1-year contract for ฿650++ every month with Galaxy S2 draw the line in the sand at ฿18,900 with no contract, and 10-months payment now available for every smart phone above ฿6,000. So buy one and get 20-Baht prepaid SIM card and you are on your way.
For us Asians who has credit cards and have no qualms about paying by installments for 10 months; pay one-tenth the price and you carry the phone out the door, that is enough of an incentive to jump.
I don't think that you really understand fractional reserve banking. How can Apple be an "$800 Billion dollar bank" with only $80 billion in capitalization?
Fractional reserve? Explain please, if you can.
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
If only it wasn't true. AAPL are being treated like they are gold and oil future now. And subject to the same speculation forces.
That is, of course, nonsense. Apple's share price is not predominantly based on speculation. If you look at virtually any measure of corporate valuation (such as price/earnings ratio, profit growth, etc), Apple's stock is significantly undervalued compared to the rest of the market.
Quote:
Originally Posted by nvidia2008
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
You're leaving out the biggest part of the picture - which really explains things. If Apple has $80B in cash, they could leverage that by using money from the Federal reserve for the loans. So if they loan someone $100,000, to use your example, $10 K of that would come out of Apple's cash and the Fed would loan them the remaining 90%. Again, it's not that simple, but it amounts to leverage - the same kind of leverage that allows you to buy a $200,000 house with only $20,000 down.
That is, of course, nonsense. Apple's share price is not predominantly based on speculation. If you look at virtually any measure of corporate valuation (such as price/earnings ratio, profit growth, etc), Apple's stock is significantly undervalued compared to the rest of the market.
You are not helping your case. Keep repeating the mantra of AAPL in undervalued and has more to run only convinced me that I am right. You are betting BIG on the stock.
You are not helping your case. Keep repeating the mantra of AAPL in undervalued and has more to run only convinced me that I am right. You are betting BIG on the stock.
Actually, no, I'm not. Apple represents about 3% of my retirement portfolio and is not even close to my largest holding. It's only about 1% of my entire net worth.
It's not just me saying it - have a look at Fortune Magazine:
Apple is trading at 8 times projected 2012 earnings - or only 5 times cash-adjusted projected 2012 earnings. That is absolutely absurd given Apple's margins and growth rates. Can you name ANY other company with comparable profit and sales growth which is trading at that level?
Furthermore, they make a strong case as to why the analysts were out of line with their projections.
You're leaving out the biggest part of the picture - which really explains things. If Apple has $80B in cash, they could leverage that by using money from the Federal reserve for the loans. So if they loan someone $100,000, to use your example, $10 K of that would come out of Apple's cash and the Fed would loan them the remaining 90%. Again, it's not that simple, but it amounts to leverage - the same kind of leverage that allows you to buy a $200,000 house with only $20,000 down.
Yup, it kinda has to do with leverage.
But as I understand it, Apple doesn't have to get that remaining 90% from the Fed... It doesn't even exist. If they loan someone $100,000, it is the borrower that owes $100,000, hence Apple "having" $100,000 even though they actually only have $10,000.
Common sense tells us that, but wait a minute, the borrower must have $90,000 from somewhere since Apple only really "gave them" $10,000. So perhaps the Fed has printed $90,000 of notes for Apple, and Apple gave $10,000 of their own notes.
This is all a fallacy. As low as 3% of all the money supply in the US exists as physical currency.
Hence, even assuming Apple has $10,000 reserve of the loan in physical notes, the $100,000 loaned to the borrower in reality doesn't even exist as physical cash.
Printed notes are no longer relevant in today's world, they are merely instruments of debt used for extremely minor transactions. Whatever cash we use for day to day use is simply a relic of the past, for the human sensation of the touch of money, and the seeming "quickness" or "security" of exchanging bills and notes instead of credit or debit cards. Think about what makes up most of commerce - credit cards, cars, houses, gadgets, phone bills, salary... Almost all of that in modern economies never even have any physical printed-note basis to them.
With Apple's $100,000 loan, it just created $90,000 out of thin air. Even the $10,000 it has as reserves is an instrument of someone else (another bank usually) that has *promised to pay* Apple $10,000. If Apple's $10,000 is US Dollar Bills then yes, the Fed owes them $10,000. If that money, as it is now, is from various sources, then the Fed may not even be involved at all. Bottom line, the $90,000 that Apple can create out of thin air from a $10,000 reserve does not involve the Fed nor anything at all... It just, creates money by nature of the $100,000 loan being made.
The Fed creates money to start with by depositing say $1 million in a bank. (see the YouTube video above). Because that's how it "seeds" a bank so that that bank can then increase the money supply to about $10 million. That's only the green and blue lines in http://en.wikipedia.org/wiki/File:Co...ney_supply.svg because by nature of the system that red line increases at a much higher rate.
The banking system is so twisted and inbred once you realise its true nature it is both eye-opening but also truly sickening.
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
(See the YouTube video in the post below if the above seems too "long")
You are confused. If Apple tried to lend out $800B, and only had $80B to fund the loans, Apple would go bankrupt immediately upon the $800B being spent. They would give checkbooks to their borrowers, with checking account balances in the aggregate of $800B, and as soon as $81B of checks were cashed, the rest of them would all bounce.
Yes, if a new bank exists with $80B in deposits, the money supply could grow by $800B. That is dependent upon the banking system as a whole being able to create money.
But nobody with assets of $80B can give somebody else $800B.
The concepts you need to understand are the differences between deposits and assets, and the multiplier effect of the commercial banking system as a whole. You need multiple banks to grow the money supply. Not just one bank.
You are confused. If Apple tried to lend out $800B, and only had $80B to fund the loans, Apple would go bankrupt immediately upon the $800B being spent. They would give checkbooks to their borrowers, with checking account balances in the aggregate of $800B, and as soon as $81B of checks were cashed, the rest of them would all bounce.
Yes, if a new bank exists with $80B in deposits, the money supply could grow by $800B. That is dependent upon the banking system as a whole being able to create money.
But nobody with assets of $80B can give somebody else $800B.
The concepts you need to understand are the differences between deposits and assets, and the multiplier effect of the commercial banking system as a whole. You need multiple banks to grow the money supply. Not just one bank.
Sorry, but you're the one who doesn't understand. Banks can borrow money from the Fed and can therefore loan out more money than they have.
Sorry, but you're the one who doesn't understand. Banks can borrow money from the Fed and can therefore loan out more money than they have.
Yes, banks can borrow money. We are not talking about Apple borrowing money. We are talking about Apple becoming a bank and lending out ten times what they have on hand. Sure - they can get more if they borrow. The banking system as a whole creates money. Individual banks do not.
Edit: If you can understand this passage from Wikipedia, the entire picture will become clear:
For an individual bank, the deposit is considered a liability whereas the loan it gives out and the reserves are considered assets. Deposits will always be equal to loans plus a bank's reserves, since loans and reserves are created from deposits. This is the basis for a bank's balance sheet.
But the terms used in the passage need to be fully understood. Individual bank, deposit, liability, loan, reserves, assets. Without a clear understanding, it is easy to confuse the system as a whole with a new bank which has reserves of $80B.
Second edit:
Step one: Deposits at Apple Bank = $80B.
Step 2: Given a 10% reserve requirement, Apple is able to lend a total of $72B to third parties.
Translation:
Deposits ($80B) will always be equal to loans ($72B) plus a bank's reserves ($8B), since loans and reserves are created from deposits.
Again - too defensive. iPhone sales were disappointing.
Yes, 17 million+ sales of a phone that is more than a year old, and which has been rumoured to be replaced for months is 'disappointing'. What frame of reference are we using here? Because at whatever angle you view it, from planet earth, that's an astounding number, compared to any other company and any other product in existence. But hey, this is Apple, and their numbers should match the magical, and random ones 'analysts' conjure up.
Yes, 17 million+ sales of a phone that is more than a year old, and which has been rumoured to be replaced for months is 'disappointing'. What frame of reference are we using here?
The frame of reference is the expected rate of sales and the rate of increase in sales. HTH.
Comments
Apple has no debt to restructure.
Why do you say this sort of stuff? Fractional reserve? Restructure debt?
There has got to be stuff you know more about than this financial stuff. Chill.
Maybe he implied that Apple should restructure so as to incur some debt. Be open-minded to occasional, if unintended, brilliance.
Perhaps jrgosta and Apple][ put their entire life savings in Apple stock and bet on AAPL hit $500. They will say anything to keep the day of reckoning when AAPL dip below $300 away.
That's as silly and amateurish as what they are saying.
That's where the logic fails. If the stock price is to be based on an expectation of future earnings, then the blowout $37 M guidance given by Apple for the 4th quarter should have increased the stock price, not decreased it.
Har! Logic!
What if the expectation was that the guidance would be $40M?
Can you explain your logic?
I agree though, the language Apple needs to add next is Mandarin. Sorry, Europeans.
It's coming in 2012. Or, as Siri will then say, 它在2012年的到來
Do you mean iPhone 4 or iPhone 4S? I'm sure there's a lot of demand in Thailand for iPhone 4S. Scalpers I don't think have enough to supply Thailand to the level that everyone is happy with enough iPhone 4S.
4, not 4S. There are lots of demand but they are still finite numbers. The real limits of demand was price though. 4 came out in Oct 2010 with ฿23,000 for 16GB model. ฿18,000 used.
For Thailand market, ฿19,000 turned out to be a magic number of threshold price Thai buyers are willing to pay, be it cash or 0% interest over 10 months. Samsung Galaxy S2 arrived with that number and basically set the price ceiling here. BB Torch 9860, Bold 9900 and HTC EVO 3D came in at ฿20,000 and now gone. Unbelievable, but it is.
The supply issue only exists in 2010. From Jan 2011, so many scalped iPhone entered a country that every gray market shops have them on cash and carry basis since Feb. Even today you can get one just put the cash down, like so. There are THAT many.
I do not know if 'official' iPhone 4S can crack it with 4GB memory for ฿19,000 and 1-year contract for ฿650++ every month with Galaxy S2 draw the line in the sand at ฿18,900 with no contract, and 10-months payment now available for every smart phone above ฿6,000. So buy one and get 20-Baht prepaid SIM card and you are on your way.
For us Asians who has credit cards and have no qualms about paying by installments for 10 months; pay one-tenth the price and you carry the phone out the door, that is enough of an incentive to jump.
That's as silly and amateurish as what they are saying.
If only it wasn't true. AAPL are being treated like they are gold and oil future now. And subject to the same speculation forces.
I don't think that you really understand fractional reserve banking. How can Apple be an "$800 Billion dollar bank" with only $80 billion in capitalization?
Fractional reserve? Explain please, if you can.
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
http://www.youtube.com/watch?v=Dc3sKwwAaCU
(See the YouTube video in the post below if the above seems too "long")
http://en.wikisource.org/wiki/Modern_Money_Mechanics
A translation of which, goes something like this:
http://www.youtube.com/watch?v=eWl7Mb49vSk
If only it wasn't true. AAPL are being treated like they are gold and oil future now. And subject to the same speculation forces.
That is, of course, nonsense. Apple's share price is not predominantly based on speculation. If you look at virtually any measure of corporate valuation (such as price/earnings ratio, profit growth, etc), Apple's stock is significantly undervalued compared to the rest of the market.
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
http://www.youtube.com/watch?v=Dc3sKwwAaCU
You're leaving out the biggest part of the picture - which really explains things. If Apple has $80B in cash, they could leverage that by using money from the Federal reserve for the loans. So if they loan someone $100,000, to use your example, $10 K of that would come out of Apple's cash and the Fed would loan them the remaining 90%. Again, it's not that simple, but it amounts to leverage - the same kind of leverage that allows you to buy a $200,000 house with only $20,000 down.
That is, of course, nonsense. Apple's share price is not predominantly based on speculation. If you look at virtually any measure of corporate valuation (such as price/earnings ratio, profit growth, etc), Apple's stock is significantly undervalued compared to the rest of the market.
You are not helping your case. Keep repeating the mantra of AAPL in undervalued and has more to run only convinced me that I am right. You are betting BIG on the stock.
You are not helping your case. Keep repeating the mantra of AAPL in undervalued and has more to run only convinced me that I am right. You are betting BIG on the stock.
Actually, no, I'm not. Apple represents about 3% of my retirement portfolio and is not even close to my largest holding. It's only about 1% of my entire net worth.
It's not just me saying it - have a look at Fortune Magazine:
http://tech.fortune.cnn.com/2011/10/...8217;t-matter/
Apple is trading at 8 times projected 2012 earnings - or only 5 times cash-adjusted projected 2012 earnings. That is absolutely absurd given Apple's margins and growth rates. Can you name ANY other company with comparable profit and sales growth which is trading at that level?
Furthermore, they make a strong case as to why the analysts were out of line with their projections.
You're leaving out the biggest part of the picture - which really explains things. If Apple has $80B in cash, they could leverage that by using money from the Federal reserve for the loans. So if they loan someone $100,000, to use your example, $10 K of that would come out of Apple's cash and the Fed would loan them the remaining 90%. Again, it's not that simple, but it amounts to leverage - the same kind of leverage that allows you to buy a $200,000 house with only $20,000 down.
Yup, it kinda has to do with leverage.
But as I understand it, Apple doesn't have to get that remaining 90% from the Fed... It doesn't even exist. If they loan someone $100,000, it is the borrower that owes $100,000, hence Apple "having" $100,000 even though they actually only have $10,000.
Common sense tells us that, but wait a minute, the borrower must have $90,000 from somewhere since Apple only really "gave them" $10,000. So perhaps the Fed has printed $90,000 of notes for Apple, and Apple gave $10,000 of their own notes.
This is all a fallacy. As low as 3% of all the money supply in the US exists as physical currency.
Hence, even assuming Apple has $10,000 reserve of the loan in physical notes, the $100,000 loaned to the borrower in reality doesn't even exist as physical cash.
Printed notes are no longer relevant in today's world, they are merely instruments of debt used for extremely minor transactions. Whatever cash we use for day to day use is simply a relic of the past, for the human sensation of the touch of money, and the seeming "quickness" or "security" of exchanging bills and notes instead of credit or debit cards. Think about what makes up most of commerce - credit cards, cars, houses, gadgets, phone bills, salary... Almost all of that in modern economies never even have any physical printed-note basis to them.
With Apple's $100,000 loan, it just created $90,000 out of thin air. Even the $10,000 it has as reserves is an instrument of someone else (another bank usually) that has *promised to pay* Apple $10,000. If Apple's $10,000 is US Dollar Bills then yes, the Fed owes them $10,000. If that money, as it is now, is from various sources, then the Fed may not even be involved at all. Bottom line, the $90,000 that Apple can create out of thin air from a $10,000 reserve does not involve the Fed nor anything at all... It just, creates money by nature of the $100,000 loan being made.
The Fed creates money to start with by depositing say $1 million in a bank. (see the YouTube video above). Because that's how it "seeds" a bank so that that bank can then increase the money supply to about $10 million. That's only the green and blue lines in http://en.wikipedia.org/wiki/File:Co...ney_supply.svg because by nature of the system that red line increases at a much higher rate.
The banking system is so twisted and inbred once you realise its true nature it is both eye-opening but also truly sickening.
http://en.wikipedia.org/wiki/Money_supply
http://en.wikipedia.org/wiki/Money_creation
Let's say Apple says tomorrow, we are becoming a bank, nothing else. It has $80 billion in capital. It can now start giving out loans to people, businesses, governments, and so on. Let's say someone signs up for a $100,000 loan. The moment they sign up for that loan, Apple can then register that as an asset. $100,000 owed to Apple plus interest income.
Now, you might say, well, okay, if Apple loaned $100,000 then Apple must have had that $100,000 set aside for it, right? Wrong. Apple only needs to set aside 10% (or less, depending on how you fudge things). So Apple needs to only set aside $10,000. As the process continues, because Apple only needs to really "have" 10% of what they are loaning out, potentially they can loan out $800billion. Once they have loaned out that amount, that is registered as their assets, because that's what people will owe them, $800billion, plus interest income coming in every day. Boom! $800billion bank.
I don't even come close to understanding the full complexity of it. My example above is the most basic explanation of the system.
This is really a secret that the bankers do not want you to know, and is nowhere near even being taught in school. How fast TrainA arrives ahead of TrainB? That's for babies compared to the concepts of fractional reserve and "money as debt".
Banking is the biggest scam perpetrated in our lifetime:
http://www.youtube.com/watch?v=Dc3sKwwAaCU
(See the YouTube video in the post below if the above seems too "long")
You are confused. If Apple tried to lend out $800B, and only had $80B to fund the loans, Apple would go bankrupt immediately upon the $800B being spent. They would give checkbooks to their borrowers, with checking account balances in the aggregate of $800B, and as soon as $81B of checks were cashed, the rest of them would all bounce.
Yes, if a new bank exists with $80B in deposits, the money supply could grow by $800B. That is dependent upon the banking system as a whole being able to create money.
But nobody with assets of $80B can give somebody else $800B.
The concepts you need to understand are the differences between deposits and assets, and the multiplier effect of the commercial banking system as a whole. You need multiple banks to grow the money supply. Not just one bank.
You are confused. If Apple tried to lend out $800B, and only had $80B to fund the loans, Apple would go bankrupt immediately upon the $800B being spent. They would give checkbooks to their borrowers, with checking account balances in the aggregate of $800B, and as soon as $81B of checks were cashed, the rest of them would all bounce.
Yes, if a new bank exists with $80B in deposits, the money supply could grow by $800B. That is dependent upon the banking system as a whole being able to create money.
But nobody with assets of $80B can give somebody else $800B.
The concepts you need to understand are the differences between deposits and assets, and the multiplier effect of the commercial banking system as a whole. You need multiple banks to grow the money supply. Not just one bank.
Sorry, but you're the one who doesn't understand. Banks can borrow money from the Fed and can therefore loan out more money than they have.
Sorry, but you're the one who doesn't understand. Banks can borrow money from the Fed and can therefore loan out more money than they have.
Yes, banks can borrow money. We are not talking about Apple borrowing money. We are talking about Apple becoming a bank and lending out ten times what they have on hand. Sure - they can get more if they borrow. The banking system as a whole creates money. Individual banks do not.
Edit: If you can understand this passage from Wikipedia, the entire picture will become clear:
For an individual bank, the deposit is considered a liability whereas the loan it gives out and the reserves are considered assets. Deposits will always be equal to loans plus a bank's reserves, since loans and reserves are created from deposits. This is the basis for a bank's balance sheet.
http://en.wikipedia.org/wiki/Fractional_reserve_banking
But the terms used in the passage need to be fully understood. Individual bank, deposit, liability, loan, reserves, assets. Without a clear understanding, it is easy to confuse the system as a whole with a new bank which has reserves of $80B.
Second edit:
Step one: Deposits at Apple Bank = $80B.
Step 2: Given a 10% reserve requirement, Apple is able to lend a total of $72B to third parties.
Translation:
Deposits ($80B) will always be equal to loans ($72B) plus a bank's reserves ($8B), since loans and reserves are created from deposits.
Again - too defensive. iPhone sales were disappointing.
Yes, 17 million+ sales of a phone that is more than a year old, and which has been rumoured to be replaced for months is 'disappointing'. What frame of reference are we using here? Because at whatever angle you view it, from planet earth, that's an astounding number, compared to any other company and any other product in existence. But hey, this is Apple, and their numbers should match the magical, and random ones 'analysts' conjure up.
Yes, 17 million+ sales of a phone that is more than a year old, and which has been rumoured to be replaced for months is 'disappointing'. What frame of reference are we using here?
The frame of reference is the expected rate of sales and the rate of increase in sales. HTH.
Sorry, but you're the one who doesn't understand. Banks can borrow money from the Fed and can therefore loan out more money than they have.
Seriously dude, that's just not how banks work, even in today's world.
The frame of reference is the expected rate of sales and the rate of increase in sales. HTH.
I'd say it's really about sequential quarters.
The process of money creation as described by the Federal Reserve itself, if anyone thinks these are just wacko anarchists:
http://en.wikisource.org/wiki/Modern_Money_Mechanics
Can you point out where it says that an individual bank with $80B in deposits is allowed to lend out $800B?
Forget the youtube cartoon version.