Nothing wrong with being more shareholder friendly.
Jobs hated stockholders.
Jobs did not hate stockholders, he hated stockholders who weren't investors. He hated those who were just looking for a short term increase in value. I hate them too. They're just leeches. They don't create anything of value, their interests are short term and run totally contrary to creating a successful long term business. The only benefit they potentially provide is to consolidate capital so that it can be better invested, but they actually just use that capital for more short term purchases to generate more cash to make more short term purchases. They create nothing.
So how much cash does Apple need? Isn't $150B enought? At this rate they will increasing their cash pile by 25-35 billion each year. And why? To earn 1% interest? They need to either increase the dividend or make it clear that acquisitions are coming (they don't need to say who or what). If not it makes Apple look like they don't give a crap about the investors. And that's one reason why the stock is stalling.
You must be naive if you think it's all cash in a saving account. They invest it or Tim Cook swims in a vault of gold coins.
No company announces it is acquiring companies until the deal is made. Why should Apple be any different?
If you can't handle Apple's secrecy, get out and stop whining.
Of course it is. Presumably, Apple would sell off the pieces that it does not need/want. That's what acquirers generally do after making strategic acquisitions.
I like the idea of buying Sony. But that is only $15 Billion. That leaves Apple with $160 billion at the end of the year.
People like you are hilarious, who are so concerned with how much money Apple has and would prefer they just shit it away frivolously, or buy companies for the hell of it. I'm sure if Apple had its eye on a massive acquisition and believed it would enchance their brand and product line in a positive way, they would go for it. But spending mass amount of money on stuff that may not be of real benefit- just because they HAVE the money- screams of irresponsibility. Believe it or not, Apple has a shitload of insanely intelligent people working there that whose sole job it is to assess potential acquisition of talent. No doubt they know about what the right moves are than a random person like you screaming at them to buy something expensive or "give money back to the shareholders". Apple has earned its success and has earned the right to do with its cash hoard as it sees fit. It doesnt owe you a damn thing.
You need to brush up a bit about the history of corporate governance in the US.
For starters, please do a search for the following three phrases: (i) Michigan Supreme Court Dodge v. Ford; (ii) MBCA; (iii) ALI Principles of Corporate Governance Section 2.01.
No, I think YOU should read up on those things then understand the definition of "fiduciary duty". Internet armchair lawyers are always worth exactly what you pay them. First, a Michigan state court ruling means exactly that ... Michigan. Second, some independent organization that says what it thinks the principles of corporate governance should be means exactly that. Nothing.
Quote (as cited in Wikipedia entry from University of Chicago - Law School Law Review article):
"Dodge is often misread or mistaught as setting a legal rule of shareholder wealth maximization. This was not and is not the law. Shareholder wealth maximization is a standard of conduct for officers and directors, not a legal mandate. The business judgment rule [which was also upheld in this decision] protects many decisions that deviate from this standard. This is one reading of Dodge. If this is all the case is about, however, it isn’t that interesting."
I stepped outside for a little bit and I saw that AAPL had popped up in the last few minutes before close. Now I see why, and I guess it's thanks to Apple responding to the lawsuit, so it's a good thing that this guy sued Apple, IMO.
And I'm not pretending to know what Apple should do with it's huge cash pile, but here's one crazy idea, spend a Billion or so and announce a new Apple produced mini series, something that is as good as Breaking Bad, Game of Thrones, Band of Brothers and other premium series. Apple can produce some of their own content, which will tie in nicely when they release their TV. If somebody wants to be a major player, don't they need some of their own programming? Even Netflix has gotten into the game now, and I believe Amazon too.
If Apple is starting to stabilize and is not going to be a super growth company anymore, then surely, it needs to look into expanding into other areas, IMO. There's only so many phones that you can sell to people.
By early last year, Apple’s cash balance had built to a point beyond what we needed to run our business and maintain flexibility to take advantage of strategic opportunities, so we announced a plan to return $45 billion to shareholders over three years. As of next week we will have executed $10 billion of that plan.
We find ourselves in the fortunate position of continuing to generate large amounts of cash, including $23 billion in cash flow from operations in the last quarter alone.
Apple’s management team and Board of Directors have been in active discussions about returning additional cash to shareholders. As part of our review, we will thoroughly evaluate Greenlight Capital’s current proposal to issue some form of preferred stock. (Bold mine) We welcome Greenlight’s views and the views of all of our shareholders.
As a part of our efforts to further enhance corporate governance and serve our shareholders’ best interests, Proposal #2 in our proxy includes some recommended changes to our articles of incorporation. These changes were recommended independently of Greenlight’s proposal and would not preclude Apple from adopting their concept. Contrary to Greenlight’s statements, adoption of Proposal #2 would not prevent the issuance of preferred stock. Currently, Apple’s articles of incorporation provide for the issuance of “blank check” preferred stock by the Board of Directors without shareholder approval. If Proposal #2 is adopted, our shareholders would have the right to approve the issuance of preferred stock. As such, Proposal #2 has the support of many of our shareholders.
We remain committed to having an ongoing dialogue with our shareholders to get perspectives around return of capital and driving shareholder value.
I like this response from Apple - fair bit of spin in there yet polite.
The court case should prove interesting, tho.
Anyone heard of a date being set ?
On the surface of the statement it would appear Greenlight don't have a case and would be wise to withdraw.
No, I think YOU should read up on those things then understand the definition of "fiduciary duty". Internet armchair lawyers are always worth exactly what you pay them. First, a Michigan state court ruling means exactly that ... Michigan. Second, some independent organization that says what it thinks the principles of corporate governance should be means exactly that. Nothing.
So that you're not under some misunderstanding, I am not a lawyer, let alone an armchair one. I just consider myself a reasonably informed citizen of my country.
If you don't understand the importance of State Supreme Court decisions that are not challenged all the way to the SCOTUS in a system of Common Law where the underlying legal principle is stare decisis, all I can say is that you're fundamentally clueless about how the law works in the US.
Suffice it to say that Dodge v. Ford (1919) is considered one of the founding cornerstones of corporate law in the US. Indeed, it is the starting point for hundreds of Delaware Chancery (look up the significance of that) decisions.
You deepen your ignorance -- and simply reveal your willingness to wallow in it -- if you are dismissing the role that American Law Institute and its Principles play in the formation of US law. If you live in the US, you might be interested to know that just about any major piece of law that governs your life -- family law, criminal law, commercial law, etc -- are drawn from a wide-ranging set of of ALI Principles. (I gave you the one just for corporate law). That's what every state legislature uses in this country as a reference guide to craft legislation. That's the first thing you would be handed if you were asked to become a board member or officer of a public company in the US. Look up 'ALI' and you might actually learn something.
You compound that ignorance by dismissing outright the Model Business Corporation Act (and its subsequent revision), which goes back to the 1950s and precedes ALI. Basically, I tried to give you three huge landmarks in the development of US corporate governance over the past century, and you throw back Wikipedia at me. Pathetic.
As to your puling up a random law review article, know that there are hundreds and hundreds of law review articles on Dodge v. Ford. If you want to PM me, I'd be happy to give you review/synthesis articles that summarize a sizable number of these. I know the literature well, and the same can't be said about you.
This is another typical example of Hedge Fund greed. As an Apple Investor I would like to get more for my shares obviously, perhaps in the form of a dividend or preferably a stock buyback coupled with a split.
Either way, if your sick and tired of these jerks yanking the stock around... note that this guy is a short seller by preference... so who is to say they didn't push it down to make the company more pliable and receptive to their attempted raid on the kitty?
Me personally I am sick of this crap. So I did something about it, and you can too! If your an Apple Investor or employee go here and sign the petition to ask Congress to stop hedge funds from manipulating the stock prices of public companies like Apple.
It only includes realized gains. However, given the types of securities Apple invest in -- certainly judged by the realized gains -- I'd venture a guess that capital gains are likely to be modest at best.
So lumping all cash and investments to get 1% ROI in just dividends and interest is stupid then considering cash only add to 16bn.
So that you're not under some misunderstanding, I am not a lawyer, let alone an armchair one. I just consider myself a reasonably informed citizen of my country.
Just so we're clear, I am a lawyer and your understanding of stare decisis is exactly as you describe ... one of a citizen and rather misinformed. A Michigan Supreme Court decision is exactly that, a ruling for Michigan. And it doesn't even say what you claim it says. There is no other settled law that the creation of shareholder value is a fiduciary duty of the board or officers in a corporation. You can write as long of a treatise as you want, but it's still not true. If you want to argue that there's an obligation that's a different thing but when you claim to the "legal obligation" standard you just don't have anything. Just imagine the complete mess that would be created if your premise were true. Every time a stock decreases in value, you are suggesting that shareholders have a valid civil claim. It's so ludicrous that it's hard to take the premise seriously. Beyond that, it's just not the law. Yes, it's true. I am stating outright that it's not the law. Even in Michigan. When you cite a single statute or even ruling court decision that says it is, then we can argue it. Otherwise, your premise is nothing more than your personal "informed citizen" view. That's worth twice as much as your legal knowledge. Anyone who argues a published article in the University of Chicago's Law Review - articles which are often referenced and footnoted in high court decisions - carries little weight while private institutes define settled law is ... well ... there's not even a way to describe it.
I don't think issuing perpetual preferred stock is in the best interest of the company. Adding a preferred stock would just lower the value of the common stock anyways. I think Apple wants to see itself at a $1000 stock price, probably a reason they haven't issued a stock split. The best thing Apple should do is to buyback more shares. Issuing a buyback will lowers the total number of outstanding shares; lowering supply and increasing demand for the stock. If they believe in their company and how undervalued it is right now, then issuing a large buyback would be the best way to convince investors.
I'm surprised Obama and team haven't looked more at this potential source of new revenue. Section 531 of the IRS code calls for a 15% tax on excessive retained earnings. At least that's how I read it. It just hasn't been enforced aggressively.
I imagine the debate would then move on to what is excessive. Either way, holding excess cash from earnings does slow economic growth.
This is part of the damage that occurs when corporations and individuals are in a defensive mode. We see it in nearly all our clients. It's hammering the economy.
Apple is spending a lot of money on capital projects: new "spaceship" HQ; servers farms; green power plants.
Also, nearly half of Apple's billions sit in overseas banks because the US-IRS wants 35% of it if it is ever brought into the USA. It doesn't matter how much money Apple has, what is important is where it is located. So how can Apple's US-based cash be regarded as "excessive retained earnings" and how does it slow economic growth?
Just so we're clear, I am a lawyer and your understanding of stare decisis is exactly as you describe ... one of a citizen and rather misinformed. A Michigan Supreme Court decision is exactly that, a ruling for Michigan. And it doesn't even say what you claim it says. There is no other settled law that the creation of shareholder value is a fiduciary duty of the board or officers in a corporation. You can write as long of a treatise as you want, but it's still not true. If you want to argue that there's an obligation that's a different thing but when you claim to the "legal obligation" standard you just don't have anything. Just imagine the complete mess that would be created if your premise were true. Every time a stock decreases in value, you are suggesting that shareholders have a valid civil claim. It's so ludicrous that it's hard to take the premise seriously. Beyond that, it's just not the law. Yes, it's true. I am stating outright that it's not the law. Even in Michigan. When you cite a single statute or even ruling court decision that says it is, then we can argue it. Otherwise, your premise is nothing more than your personal "informed citizen" view. That's worth twice as much as your legal knowledge. Anyone who argues a published article in the University of Chicago's Law Review - articles which are often referenced and footnoted in high court decisions - carries little weight while private institutes define settled law is ... well ... there's not even a way to describe it.
You sound pretty illiterate, for a lawyer. I wouldn't advertise that fact in public.
1) Stare decisis = 'the decision remains.' It is the fundamental guiding principle of common law systems (to which the US belongs).
2) I'd like you to show me one MAJOR court decision (that hasn't been thrown out on its butt) -- with the exception of the Paramount decision (look it up) which delimited Dodge v. Ford somewhat to make a distinction between short-term versus long-term shareholder value creation (the Delaware court, correctly, favored the latter) -- that goes directly against Dodge v. Ford. If you can't, you should just quietly move along.
3) It is shocking to me that, as a lawyer, you had no clue about RMBCA or, more importantly, ALI. That reveals your ignorance in spades.
4) Here's a suggestion for you. Buy a copy of the Corporate Director's Guidebook (it's not expensive), read it (it is a very short read), and then come back and post about the fiduciary duties of an officer/director of a corporation in the US.
What kind of lawyer are you? Where did you get your degree!?
As to published articles in leading law reviews (and I grant, Univ of Chicago LR is as good as it gets), I can I assure you -- without revealing too much more, since I am loathe to reveal much about myself in these forums that rely on anonymity so much -- that you'd be impressed with the citations I can give you. On this topic. But you'd have to PM me.
Anyways, Einhorn must have better things to do, like take over some promising new American company and manage it into the ground.
That is indeed what I read on Wikipedia. Quite pathetic, to profit from someone else's misfortune, that he inflicts upon them. Over here in NL we have a so called news reporter / investigator who goes through devious ways to film people that are suspect of wrongdoing. True or false, he makes money selling his tapes to broadcasting companies, all because of the misery of others. Really uncool, unprofessional and downright pathetic.
Apple is spending a lot of money on capital projects: new "spaceship" HQ; servers farms; green power plants.
Also, nearly half of Apple's billions sit in overseas banks because the US-IRS wants 35% of it if it is ever brought into the USA. It doesn't matter how much money Apple has, what is important is where it is located. So how can Apple's US-based cash be regarded as "excessive retained earnings" and how does it slow economic growth?
What is excessive is something the IRS is probably debating internally. That's the 64K question, right? Do they need 300B or 400B? At what point is it excessive. They can build the spaceship building and plenty of RAM with what they have now. I'm not making that judgment, just posing the question.
How does it slow economic growth? Whatever portion of cash companies hang on to, whether overseas or not, is not being utilized as effectively as it might. If most corporations go into this defensive mode (like, say, due to a horrible economy and distaste for risk), it creates a drag on growth. Imagine the 100s of billions being used to hire employees, build stuff, invest in new plants and equipment or R&D, etc.
In Japan, they have this very problem. Only, it's not with corporations. It's with their own people, who tend to save money. Economic growth flows from spending and as great as saving is, if everybody does it, it's not a good thing for GDP. Our corps. are sitting on a lot of cash. No one is making bold moves, though I'd exempt Apple from that, generally.
Comments
Quote:
Originally Posted by sog35
Nothing wrong with being more shareholder friendly.
Jobs hated stockholders.
Jobs did not hate stockholders, he hated stockholders who weren't investors. He hated those who were just looking for a short term increase in value. I hate them too. They're just leeches. They don't create anything of value, their interests are short term and run totally contrary to creating a successful long term business. The only benefit they potentially provide is to consolidate capital so that it can be better invested, but they actually just use that capital for more short term purchases to generate more cash to make more short term purchases. They create nothing.
Quote:
Originally Posted by sog35
I like the idea of buying Sony. But that is only $15 Billion. That leaves Apple with $160 billion at the end of the year.
That pretty much speaks for itself about the quality of your advice about what Apple should do with its cash.
Quote:
Originally Posted by jungmark
Quote:
Originally Posted by sog35
The problem is this:
$150 Billion in cash and short term investments.
$40-$50 EACH YEAR from operations
$15 Billion each year in buybacks and dividends
So how much cash does Apple need? Isn't $150B enought? At this rate they will increasing their cash pile by 25-35 billion each year. And why? To earn 1% interest? They need to either increase the dividend or make it clear that acquisitions are coming (they don't need to say who or what). If not it makes Apple look like they don't give a crap about the investors. And that's one reason why the stock is stalling.
You must be naive if you think it's all cash in a saving account. They invest it or Tim Cook swims in a vault of gold coins.
No company announces it is acquiring companies until the deal is made. Why should Apple be any different?
If you can't handle Apple's secrecy, get out and stop whining.
Quote:
Originally Posted by Flaneur
Sony is an unfocused mess......
Of course it is. Presumably, Apple would sell off the pieces that it does not need/want. That's what acquirers generally do after making strategic acquisitions.
Quote:
Originally Posted by sog35
I like the idea of buying Sony. But that is only $15 Billion. That leaves Apple with $160 billion at the end of the year.
People like you are hilarious, who are so concerned with how much money Apple has and would prefer they just shit it away frivolously, or buy companies for the hell of it. I'm sure if Apple had its eye on a massive acquisition and believed it would enchance their brand and product line in a positive way, they would go for it. But spending mass amount of money on stuff that may not be of real benefit- just because they HAVE the money- screams of irresponsibility. Believe it or not, Apple has a shitload of insanely intelligent people working there that whose sole job it is to assess potential acquisition of talent. No doubt they know about what the right moves are than a random person like you screaming at them to buy something expensive or "give money back to the shareholders". Apple has earned its success and has earned the right to do with its cash hoard as it sees fit. It doesnt owe you a damn thing.
Quote:
Originally Posted by anantksundaram
You need to brush up a bit about the history of corporate governance in the US.
For starters, please do a search for the following three phrases: (i) Michigan Supreme Court Dodge v. Ford; (ii) MBCA; (iii) ALI Principles of Corporate Governance Section 2.01.
No, I think YOU should read up on those things then understand the definition of "fiduciary duty". Internet armchair lawyers are always worth exactly what you pay them. First, a Michigan state court ruling means exactly that ... Michigan. Second, some independent organization that says what it thinks the principles of corporate governance should be means exactly that. Nothing.
Quote (as cited in Wikipedia entry from University of Chicago - Law School Law Review article):
"Dodge is often misread or mistaught as setting a legal rule of shareholder wealth maximization. This was not and is not the law. Shareholder wealth maximization is a standard of conduct for officers and directors, not a legal mandate. The business judgment rule [which was also upheld in this decision] protects many decisions that deviate from this standard. This is one reading of Dodge. If this is all the case is about, however, it isn’t that interesting."
I stepped outside for a little bit and I saw that AAPL had popped up in the last few minutes before close. Now I see why, and I guess it's thanks to Apple responding to the lawsuit, so it's a good thing that this guy sued Apple, IMO.
And I'm not pretending to know what Apple should do with it's huge cash pile, but here's one crazy idea, spend a Billion or so and announce a new Apple produced mini series, something that is as good as Breaking Bad, Game of Thrones, Band of Brothers and other premium series. Apple can produce some of their own content, which will tie in nicely when they release their TV. If somebody wants to be a major player, don't they need some of their own programming? Even Netflix has gotten into the game now, and I believe Amazon too.
If Apple is starting to stabilize and is not going to be a super growth company anymore, then surely, it needs to look into expanding into other areas, IMO. There's only so many phones that you can sell to people.
Quote:
Originally Posted by Gatorguy
Apple's entire press release from today is as follows:
Apple Leadership
Product Images & Info
Press Releases
February 7, 2013
By early last year, Apple’s cash balance had built to a point beyond what we needed to run our business and maintain flexibility to take advantage of strategic opportunities, so we announced a plan to return $45 billion to shareholders over three years. As of next week we will have executed $10 billion of that plan.Statement by Apple
We find ourselves in the fortunate position of continuing to generate large amounts of cash, including $23 billion in cash flow from operations in the last quarter alone.
Apple’s management team and Board of Directors have been in active discussions about returning additional cash to shareholders. As part of our review, we will thoroughly evaluate Greenlight Capital’s current proposal to issue some form of preferred stock. (Bold mine) We welcome Greenlight’s views and the views of all of our shareholders.
As a part of our efforts to further enhance corporate governance and serve our shareholders’ best interests, Proposal #2 in our proxy includes some recommended changes to our articles of incorporation. These changes were recommended independently of Greenlight’s proposal and would not preclude Apple from adopting their concept. Contrary to Greenlight’s statements, adoption of Proposal #2 would not prevent the issuance of preferred stock. Currently, Apple’s articles of incorporation provide for the issuance of “blank check” preferred stock by the Board of Directors without shareholder approval. If Proposal #2 is adopted, our shareholders would have the right to approve the issuance of preferred stock. As such, Proposal #2 has the support of many of our shareholders.
We remain committed to having an ongoing dialogue with our shareholders to get perspectives around return of capital and driving shareholder value.
I like this response from Apple - fair bit of spin in there yet polite.
The court case should prove interesting, tho.
Anyone heard of a date being set ?
On the surface of the statement it would appear Greenlight don't have a case and would be wise to withdraw.
C'mon Einhorn - whatcha gonna do ?
edit: oh wait. - I know one thing you could do !
Redesign your website :-)
Quote:
Originally Posted by focher
No, I think YOU should read up on those things then understand the definition of "fiduciary duty". Internet armchair lawyers are always worth exactly what you pay them. First, a Michigan state court ruling means exactly that ... Michigan. Second, some independent organization that says what it thinks the principles of corporate governance should be means exactly that. Nothing.
So that you're not under some misunderstanding, I am not a lawyer, let alone an armchair one. I just consider myself a reasonably informed citizen of my country.
If you don't understand the importance of State Supreme Court decisions that are not challenged all the way to the SCOTUS in a system of Common Law where the underlying legal principle is stare decisis, all I can say is that you're fundamentally clueless about how the law works in the US.
Suffice it to say that Dodge v. Ford (1919) is considered one of the founding cornerstones of corporate law in the US. Indeed, it is the starting point for hundreds of Delaware Chancery (look up the significance of that) decisions.
You deepen your ignorance -- and simply reveal your willingness to wallow in it -- if you are dismissing the role that American Law Institute and its Principles play in the formation of US law. If you live in the US, you might be interested to know that just about any major piece of law that governs your life -- family law, criminal law, commercial law, etc -- are drawn from a wide-ranging set of of ALI Principles. (I gave you the one just for corporate law). That's what every state legislature uses in this country as a reference guide to craft legislation. That's the first thing you would be handed if you were asked to become a board member or officer of a public company in the US. Look up 'ALI' and you might actually learn something.
You compound that ignorance by dismissing outright the Model Business Corporation Act (and its subsequent revision), which goes back to the 1950s and precedes ALI. Basically, I tried to give you three huge landmarks in the development of US corporate governance over the past century, and you throw back Wikipedia at me. Pathetic.
As to your puling up a random law review article, know that there are hundreds and hundreds of law review articles on Dodge v. Ford. If you want to PM me, I'd be happy to give you review/synthesis articles that summarize a sizable number of these. I know the literature well, and the same can't be said about you.
Ugh. Actually, no more for you.
if apple listened to shareholders would it really be where it is now ? no
apple please go private and get rid of the disease of bad shareholders.
Either way, if your sick and tired of these jerks yanking the stock around... note that this guy is a short seller by preference... so who is to say they didn't push it down to make the company more pliable and receptive to their attempted raid on the kitty?
Me personally I am sick of this crap. So I did something about it, and you can too! If your an Apple Investor or employee go here and sign the petition to ask Congress to stop hedge funds from manipulating the stock prices of public companies like Apple.
https://www.change.org/petitions/stop-the-manipulation-of-stock-prices-by-hedge-funds
And then go here and send a copy of the letter posted there to members of the Senate Banking Committee.
http://stop-stock-manipulation.blogspot.com/2013/02/letter-to-congress.html
Thanks
AFBI
So lumping all cash and investments to get 1% ROI in just dividends and interest is stupid then considering cash only add to 16bn.
Quote:
Originally Posted by anantksundaram
So that you're not under some misunderstanding, I am not a lawyer, let alone an armchair one. I just consider myself a reasonably informed citizen of my country.
Just so we're clear, I am a lawyer and your understanding of stare decisis is exactly as you describe ... one of a citizen and rather misinformed. A Michigan Supreme Court decision is exactly that, a ruling for Michigan. And it doesn't even say what you claim it says. There is no other settled law that the creation of shareholder value is a fiduciary duty of the board or officers in a corporation. You can write as long of a treatise as you want, but it's still not true. If you want to argue that there's an obligation that's a different thing but when you claim to the "legal obligation" standard you just don't have anything. Just imagine the complete mess that would be created if your premise were true. Every time a stock decreases in value, you are suggesting that shareholders have a valid civil claim. It's so ludicrous that it's hard to take the premise seriously. Beyond that, it's just not the law. Yes, it's true. I am stating outright that it's not the law. Even in Michigan. When you cite a single statute or even ruling court decision that says it is, then we can argue it. Otherwise, your premise is nothing more than your personal "informed citizen" view. That's worth twice as much as your legal knowledge. Anyone who argues a published article in the University of Chicago's Law Review - articles which are often referenced and footnoted in high court decisions - carries little weight while private institutes define settled law is ... well ... there's not even a way to describe it.
Quote:
Originally Posted by bugsnw
I'm surprised Obama and team haven't looked more at this potential source of new revenue. Section 531 of the IRS code calls for a 15% tax on excessive retained earnings. At least that's how I read it. It just hasn't been enforced aggressively.
I imagine the debate would then move on to what is excessive. Either way, holding excess cash from earnings does slow economic growth.
This is part of the damage that occurs when corporations and individuals are in a defensive mode. We see it in nearly all our clients. It's hammering the economy.
Apple is spending a lot of money on capital projects: new "spaceship" HQ; servers farms; green power plants.
Also, nearly half of Apple's billions sit in overseas banks because the US-IRS wants 35% of it if it is ever brought into the USA. It doesn't matter how much money Apple has, what is important is where it is located. So how can Apple's US-based cash be regarded as "excessive retained earnings" and how does it slow economic growth?
You sound pretty illiterate, for a lawyer. I wouldn't advertise that fact in public.
1) Stare decisis = 'the decision remains.' It is the fundamental guiding principle of common law systems (to which the US belongs).
2) I'd like you to show me one MAJOR court decision (that hasn't been thrown out on its butt) -- with the exception of the Paramount decision (look it up) which delimited Dodge v. Ford somewhat to make a distinction between short-term versus long-term shareholder value creation (the Delaware court, correctly, favored the latter) -- that goes directly against Dodge v. Ford. If you can't, you should just quietly move along.
3) It is shocking to me that, as a lawyer, you had no clue about RMBCA or, more importantly, ALI. That reveals your ignorance in spades.
4) Here's a suggestion for you. Buy a copy of the Corporate Director's Guidebook (it's not expensive), read it (it is a very short read), and then come back and post about the fiduciary duties of an officer/director of a corporation in the US.
What kind of lawyer are you? Where did you get your degree!?
As to published articles in leading law reviews (and I grant, Univ of Chicago LR is as good as it gets), I can I assure you -- without revealing too much more, since I am loathe to reveal much about myself in these forums that rely on anonymity so much -- that you'd be impressed with the citations I can give you. On this topic. But you'd have to PM me.
When Hedge Fund managers do something other than move money around, I may actually care what they have to say.
Anyways, Einhorn must have better things to do, like take over some promising new American company and manage it into the ground.
That is indeed what I read on Wikipedia. Quite pathetic, to profit from someone else's misfortune, that he inflicts upon them. Over here in NL we have a so called news reporter / investigator who goes through devious ways to film people that are suspect of wrongdoing. True or false, he makes money selling his tapes to broadcasting companies, all because of the misery of others. Really uncool, unprofessional and downright pathetic.
Quote:
Originally Posted by sip
Apple is spending a lot of money on capital projects: new "spaceship" HQ; servers farms; green power plants.
Also, nearly half of Apple's billions sit in overseas banks because the US-IRS wants 35% of it if it is ever brought into the USA. It doesn't matter how much money Apple has, what is important is where it is located. So how can Apple's US-based cash be regarded as "excessive retained earnings" and how does it slow economic growth?
What is excessive is something the IRS is probably debating internally. That's the 64K question, right? Do they need 300B or 400B? At what point is it excessive. They can build the spaceship building and plenty of RAM with what they have now. I'm not making that judgment, just posing the question.
How does it slow economic growth? Whatever portion of cash companies hang on to, whether overseas or not, is not being utilized as effectively as it might. If most corporations go into this defensive mode (like, say, due to a horrible economy and distaste for risk), it creates a drag on growth. Imagine the 100s of billions being used to hire employees, build stuff, invest in new plants and equipment or R&D, etc.
In Japan, they have this very problem. Only, it's not with corporations. It's with their own people, who tend to save money. Economic growth flows from spending and as great as saving is, if everybody does it, it's not a good thing for GDP. Our corps. are sitting on a lot of cash. No one is making bold moves, though I'd exempt Apple from that, generally.