radarthekat

muthuk_vanalingam said:

radarthekat said:

Benchmarks, schmenchmarks.  In the real word every friend of mine has an Android phone, because I’m living in the Philippines where almost nobody, including most of the expats here, can afford an iPhone.  And what I see in everyday use is that the simplest action taken on those Androids compares horribly to my iPhone 6. And what action is that?  It’s something that people do many times every day.  The simple action of pinching to zoom a photo.  Seems like there’s something either amiss in the touch controller or somewhere deeper down, but I constantly see Androiders pinching two and three times before a picture will start to zoom, and then it suddenly zooms too far and they’re pinching back the other way.  On every iPhone I’ve had it’s buttery smooth.  What is it about the Android universe where this simple action can’t be nailed?  

I tried the exact same scenario in my Moto G5 Plus ($230) and I don't observe such an issue. Looks like your friends are stuck in 2013/14. Because even the mid-range Android phones (for about $200) in 2016/2017 have good enough performance to do the basic tasks without any hassle. They struggle only when the load is heavy which is expected for that price.

What is it about the Android universe where this simple action can’t be nailed? - Unless your friends are using 2+ years old devices which cost about <$200 back then, I can't imagine such a basic issue still to be persisting. Any $200 Android phone bought in 2016 or 2017 should not have that issue. At least I have not seen such a basic issue persist in MANY devices in the past 2 years. More than 2 years back - Yes, I did see such performance issues. Not anymore.

I’ve only lived in the Philippines one year, during which time I’ve bought my girlfriend a new Oppo phone, a new Samsung for her father, and a close friend bought a new Oppo for his girl and a Samsung J7 Prime for himself.  All four of those phones, plus several others I’ve witnessed in the hands of rather tech-conversant expat friends, have exhibited this issue.  They just scoff at my iPhone when I show them how smooth it is, telling me I paid a lot more.  It’s a three-year old iPhone 6.

avon b7 said:

muthuk_vanalingam said:

avon b7 said:

fred1 said:

So much EU bashing, and why?  Do you live in the EU? (Have you ever even been to an EU country?). Did you say that the US shouldn’t exist when Congress was supposedly investigating where Aplle stashes its profits?

These EU officials are doing their job: enforcing the tax laws. Why does this seem so strange to you?

Yes. You are right. I commented in another thread on exactly what the commissioner has said now someone tried to claim I was using 'weasel' words. LOL.

All of this is being investigated as we speak. The amount of documents in this leak is vast, so vast that the work will take time to be carried out. We have already seen some prickly documents.

While all the information is verified and cross referenced, the commissioners and ministers of member states will formerly require the individuals and companies to 'fill in any gaps' on previous declarations in the cases of open investigations. 

We will see, much further down the line, just how legal the actions of those involved is, but in the case of Apple they have taken a battering in public opinion through the revelations in the press. That is precisely why Apple made a statement in the first place.

Some people seem to be having trouble accepting this, others just hate the EU.

I would be worried if the EU didn't do anything. You can be sure the US is also perusing the documents too.

Trying to make out this hasn't been a PR nightmare is frankly difficult to understand.

Actually I can guess why people in this forum think that this is NOT a PR nightmare, but you think otherwise. I got time to read only Apple's statement on this issue and I must add - it looked fairly reasonable to me (with my limited knowledge on this topic of taxation of international companies like Apple). I have NOT gone through even a SINGLE article yet on Paradise papers, what information was leaked into public domain etc. Since I have not gone through the actual story but has read only Apple's version, I have not commented on this thread yet. I can easily imagine others in this forum NOT having gone through even a single article on Paradise papers but only Apple's statement. And still comment on the topic based on their prior wealth of knowledge on taxation (which I don't have). It could be possible that only you and very few others have gone through the story from both sides while commenting.

That is definitely feasible. However, the reality is there for all to see.

If Apple has made a formal statement mere hours after this went public it should be clear that this is a major issue.

The Paradise Papers have been handed over to over 100 respected news outlets for study and documentary style reports have already been aired. 

It doesn't even matter if Apple is innocent of course. The fact that documents like the questionnaire, however normal they may be among multinationals, have reached the public domain is of paramount concern to Apple PR. The risk of some damaging mails being found among the data is also there.

I have yet to see a news piece of this subject that doesn't mention Apple and I am sure that that is a situation Apple is very worried about in its PR department which must be a hive of activity right now.

You only have to dip into the comments sections of press outlets to gauge opinion.

You seem to think Apple’s early response implies Apple is ‘worried’ about something.  It’s more reasonable to conclude that Apple made an early response simply due to the fact the Paradise Papers are being looked at by so many news outlets; a timely response provides Apple with boilerplate it can point to each time some reporter comes calling, rather than tediously responding individually to each in succession.
See also Occam’s Razor.

cbolger said:

Wait a minute! If Apple won’t pay 12% through Ireland why would they pay 12% through the United States?

or any other company for that matter....

Because Apple argues that the value upon which it ultimately would owe that tax was created in the US, in the form of the design and engineering of its hardware products and in the software.  And this is proper according to tax law.  And so Apple is okay paying tax to the United States.  But if it paid 12% to another country - a country Apple chose merely as an offshore locale to consolidate its foreign revenues - then the US, by virtue of the fact it gives a dollar-for-dollar break in foreign-paid taxes, would therefore get no tax income from Apple.  And, knowing this, it’s therefore unlikely the US would lower its repatriation tax rate from 35% to 12%.  Maybe to 24%...so that Ireland could have their 12% and the US could have the 12% they’ve been talking about.  In that scenario, US multinationals would end up paying 24%.  But what’s most likely is that the US will assist companies like Apple in making a case for where taxes should be paid while Apple goes and finds a friendlier place to consolidate their foreign-earned profits.  A place that agrees with Apple with respect to where the value is added and won’t seek to tax Apple’s foreign-earned profits.  A place like Ireland used to be before the EU stepped in.  A place like...  Jersey.

spice-boy said:

radarthekat said:

spice-boy said:

Cities, towns and of course countries give tax breaks or deferrals to large companies all the time. Look at those ridiculous mega sports stadiums which American cities subsidize for billionaire team owners using city and state taxes. After the construction how many locals really benefit outside of low paying service jobs and some mid-managmene positions. It should not be any surprise that mega corporations like Apple take advantage of "loop holes" which are not errors in the tax code but carefully crafted "tax escapes" for big companies to exploit. The authors of these tax laws are trying to please their real masters and I am not talking about the average citizen. Political campaigns are fueled mostly by huge corporations which contribute to both candidates so no matter which wins they now have someone who is grateful and needs to pay back the favor. 

Apple pays the most taxes because Apple is the most profitable company in the world, what do they want an award for this? 
I can say with certainty that nothing will change in regards to these tax haven and I find it almost ironic that companies such as Apple have amassed so much money and seem to be unable to access it now. Bite the bullet Apple, pay taxes on that money earned like the rest of do. 

Do you pay taxes on your money earned every year?  All of it?  Or do you take advantage of provision in tax law that allows you set defer taxes on a portion of your income; 401(k)?  Apple isn’t only the largest tax payer in the world, it’s also the largest in the US.  And, Applepays a higher tax rate than many other large US corporations.  Did you know GE managed its taxes for many years to pay an effective tax rate of 0%?  That’s where the problems lie, not with provisions that work to allow corporations to defer repatriation. 

Unlike a corporation private individuals eventually retire and and deferred income will be necessary to keep one alive. I don't have a billion dollars siting in a tax shelter. 

Apple has 86,000 employees.  86,000 poeple with 401(k) certainly represent more than $1billion.  Far more.  But your point isn’t of any consequence.  

The point is, Apple simply doesn’t owe taxes on money it hasn’t repatriated.  Ever.  It could keep that money offshore and use it to invest in manufacturing facilities, R&D facilities, to build out its network of Apple stores in 195 other countries, to acquire non-US companies, etc.  Money used for those purposes would never be subject to US taxes.  And therein lies the salient difference; we speak of tax deferral only in the sense that, should Apple one day decide to repatriate some of its foreign-earned profits, it would at that point owe the US taxes on those profits, having deferred that obligation from the time the profits were earned until thetime they were repatriated.  And Apple does record, on its balance sheet, a potential future tax liability on some of its foreign-earning profits, because it anticipates it may one day decide to repatriate some of that money.  But it has no specific obligation to ever do so.  So Apple is not avoiding paying taxes it owes, as some suggest, nor is it deferring ‘owed’ taxes.  It’s entirely a corporation’s choice where it will eventually spend/distribute its foreign-earned profits, and only if the corporation decides to spend/distribute some of those profits back here in the states would it create a tax liability against them.  

By the way, Apple has already paid taxes, to foreign governments, against those foreign-earned profits in the various countries where the profits were earned.  That’s another bit of info people seem to neglect to understand.  Taxes have been paid.  The US government, via its tax laws, has signaled to US-based multinational companies that its cool with profits earned offshore being reinvested/spent offshore without any taxes due to the US IRS, and that only those profits that are repatriated incur a US tax.

Now does everyone understand?  

Here’s my thinking on the subject of share repurchases, written a few years ago but updated tonight to reflect the current market cap and net cash position.  

Apple - Share repurchase rationale

I’ve heard a lot of analysts as well as retail investors suggest that share repurchases are nothing more than financial engineering, implying that they do nothing to add value to a company or its stock.

An additional, and I think significant, value of share repurchases and dividend payments comes from removing unproductive excess cash from the balance sheet. Lets look at Apple, with a $900 billion market cap and about $175 billon of cash and equivalents on the books, net of debt.  Therefore, a dollar invested in Apple represents about 80 cents invested in the actual operating business, which is where the profits come from, and about 20 cents invested to buy a bit of that cash pile, earning about 1%.  Arguably a less-than-ideal allocation of each invested dollar. 

So a smart investor wants that cash removed from the books, which would either reduce the market cap of the company or, if the cash isn't being valued at even 1x its value, which could be argued is the case with Apple, removing that cash would leave the market cap where it is, which would then imply a higher earnings multiple against the productive operating side of the business, while also taking shares off the market, which would increase earnings per share going forward.

And a higher earnings multiple means that as earnings grow in the future, the stock will climb faster.  Carl Icahn must have had all of these effects in mind - more efficient allocation of investor's dollars, increase in earnings multiple against operating business, and reduction in shares netting an increase in earnings per remaining share - when he approached Tim Cook years ago.  Pity he didn't articulate his case better.