Month: September 2018

Will Facebook And Twitter Signal The Next Bear Stearns, Lehman Moment?

I would like to say that everyone remembers what took place in 2007/08, which lead to changing one’s perception from considering what was once unthinkable, to having to consider the very real prospects that the unthinkable was now probable, if not undeniable. i.e., The entire financial system, globally, was not only unraveling, but could collapse upon itself sending what we once took for granted as “your money’s good” into “what’s money?”

I know that sounds like hyperbole, but for those that still care to remember – it’s the truth.

Yet, if one looks at the “markets” today, or listens to the mainstream financial/business media outlets, it’s as if it were just some run of the mill day of note that warrants some type of yearly revisit to help fill up some dead air time between some next-in-rotation fund-manager, Ph.D’d economist from academia or, between the buzzers and cowbells of Cramer’s next “buy, buy, buy” recommendation.

But alas, not only does everyone seem to not remember, but far worse – doesn’t care. The reason?

The rewarding for the reflexive new strategy aka, BTFD (buy the f’n dips.) Where the equivalent of a monkey-throwing-darts has, once again, become the genius of investing strategy. Albeit the “monkey” is now just a mechanical algorithmic bot. Hey, but it’s AI (artificial intelligence) driven, so that makes it de facto better, right? Right?! (Hint: see “Automated Investing” for clues)

On a side note, just for a bit of remembrance, as they say. Here’s a bit of history the “buzzer king” himself would surely like one never to remember: “In Cramer We Trust” via, “The Daily Show With Jon Stewart.”

But today? It’s all about BTFD, no buzzers needed.

AI along with its promiscuous HFT (high frequency trading,) algorithmic counterparts have adulterated and perverted what was once known as “true price discovery” into the waste basket of history. Watching screens as indexes, stocks and more vault higher and higher in the face of events to what was once considered events for pause, if not outright sell signs, has filled many a BTFD account just as fast as a teenagers wastebasket watching something else. Crude comparison, yes. But all that different? Not so much.

This strategy (BTFD) has rewarded the utter most foolish type of behavior, reasoning and follow through, not just for investing, but a whole myriad of other concerns, not counting its perpetuation of crony-capitalism in both a size and scale the world has ever known. i.e., King’s of yesteryear must be rolling over with envy at just how much power, control and influence central bankers now wheeled across every aspect of the globe.

Mel Brook’s famously quipped during his movie “History of the World” (1981, Brooksfilms™) “It’s good to be the king.” I often wonder if he made a part-two today, would there be something similar to portray what being a central banker has now become. When it comes to just how much over-arching, over-reaching, over-bearing adulteration of both “markets” and business fundamentals has now become. Maybe this scene captures it better.

And if you think that’s an overstatement, just ask any saver or retiree about interest rates. i.e., “Little to the left” is today’s “Under-shooting the inflation target.” Think about it, but I digress.

So here we are some ten years later (e.g., 2008) and, once again, we seem to be wanting to reassure the “investing public” that should anything go wrong, central bankers are at the ready to once again “save the world” via some consortium of “Three marketeers.” In 1999 it was Greenspan & company. In 2008 it was Bernanke and Crew. Will there be a need for 2018/19 moniker?

This (as far as I’m concerned) is the question of the moment. But asking that question correctly requires some unconventional (and controversial) hypotheses. i.e., Will it be banks that undermine the entire system this time? Or, will it be Silicon Valley? Both scenarios have one word in common that no one dares to contemplate, let alone, try to remember. That word? Hint: Again.

What is also contained within those questions, which brings forth the controversial aspect, is also something I believe central bankers themselves have no understanding of, let alone, plan to deal with. And that “controversial aspect” is this:

Does a sudden collapse in one of the now famed FAANG stocks begin a run on both the markets, then subsequently, a run on not just banks, but many a central bank?

This is a question I have brought forth previously which I now believe is more relevant than ever before. The reasoning is simple: This handful of companies represent nearly all the impetus of today’s nosebleed valuations. Over the last few months it has been down to just two. e.g., Amazon™, Netflix™. If you include Microsoft™ as of July of this year, those three stocks alone are responsible for 71% of the S&P 500™ returns, and 78% of the Nasdaq 100™ this year.

Again, contemplate all you’ve heard about “great values,” “markets are fairly priced,” and on, and on, against the backdrop that nearly 3/4’s of all gains contained within these indexes this year are based on just a few companies, with price to earnings multiples nearly 5 or 10 times respectively that of which Microsoft had right before the dot-com crash.

And if that’s not enough to make you go, “Wait…what?” One of these companies doesn’t make $Billions, but rather – loses them. And the other can barely make a profit in its core business. i.e., retail.

“Wait…what?” indeed.

The issue now is what happens should the first of this family of stocks known as Facebook™ (FB) suddenly begin to falter further? Hint: As goes FB so goes social, all social. Period.

Could we see a replay of 2008, but instead of Bear Stearns then Lehman type of events, we something similar in-kind with FB, then Twitter™ or, vice versa? What happens, for whatever the reason, investors (or algos) begin dumping, reminiscent of the dot-com era?

What happens then, when the central banks of other countries find their once profitable investments which were  perceived as once “no-brainers” to sure-up their own national finances begin dumping? Hint: here’s just one for your consideration aka Swiss National Bank.

Social media along with search (e.g., Google™ the “G” in the “FAANG” family) has been the benefactor of another great idiom that was once unassailable to the BTFD crowd along with their “it’s different this time” brethren-in-arms. e.g., The “ads for eyeballs” metric.

But that metric is now in a serious, as well as precarious moment of fate and fortune or, infamy for possibly draining then dwindling many a fortune once made by it.

Again, the reasoning is both simple and should be self-evident: With social media platforms and others uniformly purging content providers, inevitably leading one to reasonably conclude that the followers of those purged providers would in-turn purge their social accounts. Where does the value for growth in these companies come from to sustain already exorbitant perceived levels? Let alone – for ever higher.

Insiders such as “Zuck and Crew” themselves have already purged $Billions of their own shares. And insiders across the entire “market” have used this incessant “buy back” via company funded debt to sell their own shares again – at record levels!

Should a sudden collapse in the shares of Facebook or Twitter happen in an out-of-the-blue type moment, similar in type as we in any of the last episodic scenarios witnessed in ’08 or the dot-com era, what does a central bank such as the Federal Reserve or others do?

It may not be the banks that are the initial impetus for a scare – it may come from any of these high flyers of the FAANG family.

Does a sudden run have a knock-on effect for the Swiss and its currency? Does that begin a rout elsewhere? And who steps in this time? The Fed? The EU? Can anyone? And where do you apply the “tourniquets?”

The Fed. may have authority to sure -up the banks in a crisis, but will it need to sure-up corporates in a rout? And how will it do that without backlash? Does it even know how? And more importantly would it work at all?

It is easy to argue that the replacement poster-child of the mortgage lenders of 2008 which noted the opening salvo for financial panic in 2007 was the over-leveraged, over-extended mortgage companies. The first assigned for posterity was New Century Financial™, then Countrywide™, and so forth eventually pulling in the Bear Stearns, Lehman et al.

It is entirely possible (all my conjecture, of course) we have begun to see our first in what today could morph into similar repercussions. To wit:

(Source)

Was this latest “Snap” moment the one that they’ll look back and point to, much like we do now with New Century as where it all started? No one knows, but to keep thinking or arguing there aren’t any clues today that resemble those that were taking place in both in 1999/2000 or 2007/08 is ludicrous.

For we are now in that moment of history, that may prove that old adage of history attributed to Mark Twain:

“History doesn’t repeat itself, but it often rhymes.”

As always – only time will tell. You can quote me on that.

© 2018 Mark St.Cyr

MYTR BROADCAST – Friday

©2018 Mark St.Cyr in assoc. with StreetCry Media Partners. All Rights Reserved.

(Below is for the benefit of new listeners)

Today is the latest installment of the newly launched MYTR Broadcast. It is, as I iterate every day, in the 60/40 category of ready for prime-time. After giving it the once over myself 60/40 might be a little kind. Nevertheless, I decided we launch, and we keep shipping. And we have – and continue. Warts and all.

In keeping with that nautical theme think of it this way when listening – what we’re doing is knowingly put a vessel into the water where we are pretty sure the hull is intact, the engines are primed, but the rudder and a few other navigational necessities are not yet functioning up to par, or at all, and will need to be fixed on the fly rather, than sitting and waiting in dry dock. We’re still in the “harbor” at the moment, but getting this thing into the water and see if she would float in the first place was far more important. So here we are.

What I’m releasing currently is the equivalent of what would be the first hour of a multi hour program. It will expand as we go further.

It is a little rough around the edges, drifts a bit in subject matter, but I decided getting the first one in the can was paramount. And after careful consideration, I thought it best not to have to talk the engineer down from the roof one more time, because last time, I wasn’t quite sure if I had won him over to come back down, again. He just kept mumbling something like, “Not enough money in the world..” or something like that. But I digress.

With all that said here’s a few items of importance…

First: This broadcast/podcast is not downloadable. You must come here to listen, Yes, you can pause, fast forward or, rewind. But what you can’t do is download it. That’s one feature that will make this different from others. The reasoning is simple: I want no other vendor between my content and my customer. In today’s world of wifi and internet connections downloading is no longer a priority to consume at leisure.

Next: You’ll notice there will no longer be any sharing buttons. If you would like to tell someone about the site, by all means send them a link to the site. But linking to specific content where the content can be listened elsewhere? e.g., on some social media platform. I have no interest and believe it’s just a waste of time.

Watching The Wandering Sea

On both my show and elsewhere I have been stating that this week is a week that may be very important for signaling and clues as to where we may go from here both in “markets,” as well as what it may portend for business. I offer the following for further considerations.

On Thursday I posted a chart and some notations that I felt were important and the subsequent clues that may be forthcoming. It seems the “market” was intent on doing everything in its power to hoist a “middle digit” to that hypothesis and push ever higher still. And yes, even during the “overnight” sessions.

But that’s why I’m initiating the following, because the overnight may be where the true “tell” is. But first, I’ve updated the original chart and its annotations as to try to describe what may have been the reasons behind the moves. Remember: all conjecture of course. To wit:

(Source)

As you can see on the above (where the #3 arrow points) is where I was making the case for watching and movements that may be negative. i.e., “Down”

Subsequently it had not happened as that pattern suggested, however, so too did another pattern which I labeled “#1.” I’ve annotated the above with a possible thesis. I feel that if it plays out regardless of how the original pattern morphed or failed keeps the observation front-of-mind mode.

The reasoning for this is what has happened in the overnight session. (Remember how I keep saying you have to watch the overnight as Asia is open?) A funny thing has emerged that may help bolster my original thoughts. Here’s what I mean, again, to wit:

 

The above chart depicts the futures “market” at around 8:45ish ET. The original pattern I observed in the “Cash” markets seems to now have evolved in the overnight. It’s interesting, because as this pattern seems to be resolving as implied (i.e., negative) – the current level depicted above would catapult the 9:30 open even higher. (actually much higher!)

So now which is correct because we have two originally developing and implying the same, and a third (aka “Diamond” on top chart) resolving uncharacteristically. i.e., UP. Hint: Welcome to “Quad Witching.”

So where to from here? As always, no one knows, but I have annotated both charts with respective areas I myself will be watching for possible confirmation that something may be going awry to the entire “bull” narrative.

As always, we shall see, but at least we have something to look more precisely at for further clues.

© 2018 Mark St.Cyr

Addendum To Today’s MYTR Broadcast

After today’s show as I was perusing the “markets” I noticed a technical pattern emerging that coincides with what may be taking place today and is something to keep an eye on for clues, especially when it comes to these “markets” currently in both price, timeframe, along with other forces such as tariffs, et cetera.

It doesn’t matter if you understand what is known as “technical analysis” or not, for I do. All you need to do is watch the current actions in the market and see if they play out close to what I’ve illustrated below. As I’ve said all week on my show, “Paying attention, especially when it comes to this week – is of paramount importance.”

So with that said here’s the S&P 500™ as of about noon, ET represented by 15 minute bar/candles. To wit:

(Source)

As always, we shall see, but at least there’s something we can point to and watch for that may prove valuable for further insight.

© 2018 Mark St.Cyr

MYTR BROADCAST – Thursday

©2018 Mark St.Cyr in assoc. with StreetCry Media Partners. All Rights Reserved.

(Below is for the benefit of new listeners)

Today is the latest installment of the newly launched MYTR Broadcast. It is, as I iterate every day, in the 60/40 category of ready for prime-time. After giving it the once over myself 60/40 might be a little kind. Nevertheless, I decided we launch, and we keep shipping. And we have – and continue. Warts and all.

In keeping with that nautical theme think of it this way when listening – what we’re doing is knowingly put a vessel into the water where we are pretty sure the hull is intact, the engines are primed, but the rudder and a few other navigational necessities are not yet functioning up to par, or at all, and will need to be fixed on the fly rather, than sitting and waiting in dry dock. We’re still in the “harbor” at the moment, but getting this thing into the water and see if she would float in the first place was far more important. So here we are.

What I’m releasing currently is the equivalent of what would be the first hour of a multi hour program. It will expand as we go further.

It is a little rough around the edges, drifts a bit in subject matter, but I decided getting the first one in the can was paramount. And after careful consideration, I thought it best not to have to talk the engineer down from the roof one more time, because last time, I wasn’t quite sure if I had won him over to come back down, again. He just kept mumbling something like, “Not enough money in the world..” or something like that. But I digress.

With all that said here’s a few items of importance…

First: This broadcast/podcast is not downloadable. You must come here to listen, Yes, you can pause, fast forward or, rewind. But what you can’t do is download it. That’s one feature that will make this different from others. The reasoning is simple: I want no other vendor between my content and my customer. In today’s world of wifi and internet connections downloading is no longer a priority to consume at leisure.

Next: You’ll notice there will no longer be any sharing buttons. If you would like to tell someone about the site, by all means send them a link to the site. But linking to specific content where the content can be listened elsewhere? e.g., on some social media platform. I have no interest and believe it’s just a waste of time.

Today’s Show

MYTR BROADCAST – Wednesday

©2018 Mark St.Cyr in assoc. with StreetCry Media Partners. All Rights Reserved.

(Below is for the benefit of new listeners)

Today is the latest installment of the newly launched MYTR Broadcast. It is, as I iterate every day, in the 60/40 category of ready for prime-time. After giving it the once over myself 60/40 might be a little kind. Nevertheless, I decided we launch, and we keep shipping. And we have – and continue. Warts and all.

In keeping with that nautical theme think of it this way when listening – what we’re doing is knowingly put a vessel into the water where we are pretty sure the hull is intact, the engines are primed, but the rudder and a few other navigational necessities are not yet functioning up to par, or at all, and will need to be fixed on the fly rather, than sitting and waiting in dry dock. We’re still in the “harbor” at the moment, but getting this thing into the water and see if she would float in the first place was far more important. So here we are.

What I’m releasing currently is the equivalent of what would be the first hour of a multi hour program. It will expand as we go further.

It is a little rough around the edges, drifts a bit in subject matter, but I decided getting the first one in the can was paramount. And after careful consideration, I thought it best not to have to talk the engineer down from the roof one more time, because last time, I wasn’t quite sure if I had won him over to come back down, again. He just kept mumbling something like, “Not enough money in the world..” or something like that. But I digress.

With all that said here’s a few items of importance…

First: This broadcast/podcast is not downloadable. You must come here to listen, Yes, you can pause, fast forward or, rewind. But what you can’t do is download it. That’s one feature that will make this different from others. The reasoning is simple: I want no other vendor between my content and my customer. In today’s world of wifi and internet connections downloading is no longer a priority to consume at leisure.

Next: You’ll notice there will no longer be any sharing buttons. If you would like to tell someone about the site, by all means send them a link to the site. But linking to specific content where the content can be listened elsewhere? e.g., on some social media platform. I have no interest and believe it’s just a waste of time.

What’s Keeping China’s Leaders Up At Night? Hint: It Ain’t Tariffs

I’m going to make a bold statement, which I believe no one is truly considering in the West, of what I see as a sheer political biased blackout as one can imagine.

The reasoning is simple: if it bears any type of good light on the current administration, it’s verboten. Anything derogatory or similar? Front page and/or breaking news headlines across all others. This is the state of not just the mainstream media, but from my perspective, is now where it shouldn’t be – across all the mainstream business/financial media as well. And it’s getting worse.

Whether or not one agrees or disagrees with the current administration is inconsequential when running a business. That’s because businesses have to deal with what is, not, more often than not, what may or may not be in the future.

And it’s for that reasoning why I have been disgusted and can no longer watch, read, or even listen to most. Yes, there are a select few, but these few are seemingly locked in the basements as those with a political screed and agenda are allowed to consume all the air time or waves.

Business shows, at one time, were for informing busy business people on the happenings of the day that might effect their business. Today? It’s either bash the administration or, bash capitalism in one form or another. And yesterday (or last night Asia time) helps demonstrate my accusation.

Say what you want about the current unleashing of tariffs by the U.S., for as market moving as they or may not be at this current time, there was something far more trade orientated that has possible global repercussions on the horizon that could make this latest $200Billion of imposed tariffs appear as mere drop in the bucket, for what it may cost China going forward. And yes, I do mean: China.

I urged listeners to my show on Monday to begin paying attention to the Asian market reports in the overnight hours here in the U.S. as to look for clues on how China, along with our own futures markets, may react should the tariffs be announced. And sure enough, they were indeed announced.

The reaction was typical with central banks now firmly ensconced in the daily happenings. Any perceived negativity, especially if that negativity comes as an index such as China’s Hang Seng, or Shanghai teeter above a black-hole.

The reaction was swift: If you are (still) of the BTFD (buy the f’n dip) persuasion – all was solved and rewarded as the market vaulted higher along with its U.S. futures counterpart.

However, the reasoning behind this move that I listened to across most media was nearly as vapid as the coverage of a news story that most are entirely missing. That story? N.Korea’s, Kim Jong Un and S.Korea’s Moon Jae-in hugging and greeting each other on the tarmac at the stairway of the S. Korean leaders plane parked in Pyongyang.

To not contemplate the possibilities from a business perspective, never-mind political, is a chore in willful ignorance. And the media (as far as I’m concerned) did just that.

So now you’re asking, “So what does that have to do with tariffs and China today?” Great question – and here’s why…

Regardless of your feelings on the current administration or the President, one thing is unassailable: The current N.Korea/S.Korea possibilities are via his intervention and method of dealings. Period. But, because of that fact – it appears to be a blackout of one of the most significant ongoing stories for possible business repercussions today. I intentionally stay clear of the political argument unless, it directly effects business. e.g., I only deal with the legislation, not whether it’s my “guy” or “gal” type bickering.

But, currently, the political, as well as everything else – is now China’s to lose. Yes – to lose.

What I’m going to say next is purely hypothetic, as well as conjecture, however, that doesn’t mean that there aren’t some very astute political insiders within China that may or may not be rationalizing the same conclusions.

And if they are? The knock-on effects may be earth shattering, and by that I mean that as in, this is also how war begins, Real war, not just trade. For the stakes are that high.

Question: What is China’s economy really based on? Real Estate? No – manufacturing, and being the lowest cost producer in the ultimate race of who can build it for less. But there’s a problem with the “race to the bottom” as it’s commonly known. At some point the low wage serfs want higher wages. But in a globalized world of “I don’t care who makes it, I just want it cheaper!” Selling for the lowest price wins. End of story, quality be damned.

Enter: N.Korea (NK).

N. Korea has something that was only available in China until recently. What is that? Hint: peasant or slave labor. (I’m not trying to be bombastic, that’s a true and accurate statement.) The other point it has in common is: It has been run as a communist, dictatorial, brutal regime. Again, much like China was not all that long ago.

Enter: S. Korea (SK).

SK is an advanced economy, a jewel if you will, of the Asian pacific region. It is also home to one of, if not the, largest shipping companies along with prized ship builders in the world. You have other companies such as Samsung™ and more that need labor and facilities to create products to further compete with China’s new entries into once seemingly unassailable markets.

So here’s the question: What if, with Kim Jong Un’s recent first looks at the outside world, with his recent visit to the U,S., along with S. Korea, sat down and said to himself, “Why do I need to go beg China for scraps and stay isolated as some tin-pot dictator – when I could reunite with the SK, open up and allow for factories to be built and my people would be paid? I (meaning Kim) could state to my people, (turn on all reverb and echo machines here) ‘I have vanquished the evil west and made them bow before me and begin treating the NK people as they should allowing you a better life. No one before me has been able to do it, but I KJU have done what my forefathers only dreamed possible.'”

Hint: (conjecture of course) He would be seen, as well as treated, without coercion by his people – as a true deity that walks among them.

Think about the possibilities for a moment, yes, as far and outlandish as they might seem at first blush.

Just how little would the starting point for wages need to be to employ a workforce that is currently based on real slave labor? There is almost no other place of starting point where the quality of life can be raised so fast, and so much higher.

NK is where much of China was a few decades ago, but with one distinct advantage: The S. Korea effect and all that it brings for unity in so many ways.

Which is precisely why China, I believe, can not (and probably will not) let events go further or, be contemplated.

China is facing an existential threat to Xi’s “Made In China 2025” vision if there’s even the remotest chance of a unified Korea,

Not only that, it would signal a western ideology encroachment directly on its border. Not too say anything of the western alliance of weaponry stationed in SK and throughout the regional waters.

Again, just imagine for a moment your Kim and you ponder just this one idea:

“Hmmm, let’s see, instead of the need to keep infuriating the U.S. as to get some form of monetary concessions to fuel my lifestyle, while worrying about possible attack, and hoping China would defend me. All I have to do is allow a bit of commerce to be available and the U.S., SK, along with whoever else would probably not only protect me unquestioningly, they would sing my praises. And – my people would adore on their own! I would probably, no absolutely, become rich beyond my wildest dreams. Hmmmm…”

And that my friends is a far more troubling situation than the current tit-for-tat tariffs and what I believe is truly keeping Xi up at night.

Remember: it’s exactly these types of situations which bring about thoughts for peace on earth.

That suddenly morph, then launch it into world wars as a way to keep one leader’s vision – from crumbling into another’s.

© 2018 Mark St.Cyr

MYTR Broadcast – Tuesday

©2018 Mark St.Cyr in assoc. with StreetCry Media Partners. All Rights Reserved.

(Below is for the benefit of new listeners)

Today is the latest installment of the newly launched MYTR Broadcast. It is, as I iterate every day, in the 60/40 category of ready for prime-time. After giving it the once over myself 60/40 might be a little kind. Nevertheless, I decided we launch, and we keep shipping. And we have – and continue. Warts and all.

In keeping with that nautical theme think of it this way when listening – what we’re doing is knowingly put a vessel into the water where we are pretty sure the hull is intact, the engines are primed, but the rudder and a few other navigational necessities are not yet functioning up to par, or at all, and will need to be fixed on the fly rather, than sitting and waiting in dry dock. We’re still in the “harbor” at the moment, but getting this thing into the water and see if she would float in the first place was far more important. So here we are.

What I’m releasing currently is the equivalent of what would be the first hour of a multi hour program. It will expand as we go further.

It is a little rough around the edges, drifts a bit in subject matter, but I decided getting the first one in the can was paramount. And after careful consideration, I thought it best not to have to talk the engineer down from the roof one more time, because last time, I wasn’t quite sure if I had won him over to come back down, again. He just kept mumbling something like, “Not enough money in the world..” or something like that. But I digress.

With all that said here’s a few items of importance…

First: This broadcast/podcast is not downloadable. You must come here to listen, Yes, you can pause, fast forward or, rewind. But what you can’t do is download it. That’s one feature that will make this different from others. The reasoning is simple: I want no other vendor between my content and my customer. In today’s world of wifi and internet connections downloading is no longer a priority to consume at leisure.

Next: You’ll notice there will no longer be any sharing buttons. If you would like to tell someone about the site, by all means send them a link to the site. But linking to specific content where the content can be listened elsewhere? e.g., on some social media platform. I have no interest and believe it’s just a waste of time.

MYTR Broadcast – Monday

©2018 Mark St.Cyr in assoc. with StreetCry Media Partners. All Rights Reserved.

(Below is for the benefit of new listeners)

Today is the latest installment of the newly launched MYTR Broadcast. It is, as I iterate every day, in the 60/40 category of ready for prime-time. After giving it the once over myself 60/40 might be a little kind. Nevertheless, I decided we launch, and we keep shipping. And we have – and continue. Warts and all.

In keeping with that nautical theme think of it this way when listening – what we’re doing is knowingly put a vessel into the water where we are pretty sure the hull is intact, the engines are primed, but the rudder and a few other navigational necessities are not yet functioning up to par, or at all, and will need to be fixed on the fly rather, than sitting and waiting in dry dock. We’re still in the “harbor” at the moment, but getting this thing into the water and see if she would float in the first place was far more important. So here we are.

What I’m releasing currently is the equivalent of what would be the first hour of a multi hour program. It will expand as we go further.

It is a little rough around the edges, drifts a bit in subject matter, but I decided getting the first one in the can was paramount. And after careful consideration, I thought it best not to have to talk the engineer down from the roof one more time, because last time, I wasn’t quite sure if I had won him over to come back down, again. He just kept mumbling something like, “Not enough money in the world..” or something like that. But I digress.

With all that said here’s a few items of importance…

First: This broadcast/podcast is not downloadable. You must come here to listen, Yes, you can pause, fast forward or, rewind. But what you can’t do is download it. That’s one feature that will make this different from others. The reasoning is simple: I want no other vendor between my content and my customer. In today’s world of wifi and internet connections downloading is no longer a priority to consume at leisure.

Next: You’ll notice there will no longer be any sharing buttons. If you would like to tell someone about the site, by all means send them a link to the site. But linking to specific content where the content can be listened elsewhere? e.g., on some social media platform. I have no interest and believe it’s just a waste of time.

Has Apple Now Become Sony?

On my show the other day I was voicing my recent escapes into frustration that appear to be happening far more often than any other time I can remember. The problem with this “escapade” is the reason for it. e.g., my interactions (and needs) with my current Apple™ products.

Let’s get this out-of-the-way as usual: I am and have been, for quite some time, what many might call an “Apple fan-boy.” My first business computer back in the day was an Apple IIc®. Like most, I toggled back and forth over the years between PC based platforms (i.e., Windows® based) and Apple devices via one product or another. Then, over this past decade, I completely replaced all prior PC based items with Apple. e.g., computers, software,  iPad®, iPod®, you name it. The reasoning behind it was simple: everything seemed to work intuitively, seamlessly and across all the varying devices.

But that was then – and this is now – and my latest “escapades” have decisively proven out that the word “intuitive” has been jettisoned right alongside with all the other no longer “supported” software or devices. As for “innovation?” All I can say to that is what product are you looking at, e.g., Apple devices or, Apple the stock?

If your answer is “Apple the stock?” Then take solace that “Cook and Crew” has you covered, for even the once heralded technophobic investor known as Warren Buffett is buying. Buying the stock that is, right along with Apple’s massive ongoing share repurchase program of its own.

This is what appears to be Apple’s primary focus today. The problem with it is – once the stock value story is over – so too may Apple’s dream days of basking in the Wall Street floodlights. And that day may be far closer than anyone believes. But then again, the new digs to bask in that afterglow may be far more useful than the place for innovation that seemed to be the narrative that preceded it.

Or, said differently: what better place to reflect and bask on the laurels of Jobs, but in the building he also envisioned and began.

Again, I’m not just piling on to the ever-growing negative commentary after Apple’s latest event. (on a side note, how many even noticed they had one? I know I only realized after-the-fact, and that in-itself surprised me.) But “ever-growing” is a relevant term.

As I iterated in the beginning of the article this all came to bear as I was having what may have been my single most frustrating day with my Apple products than ever before.

One of the first things I must note for illustrative purposes is that I upgraded all my current Apple computers (yes, multiple) just last year. The problem?

I purchased, then upgraded via 2012 models. The reasoning? You can no longer upgrade Apple products. i.e., if you outgrow what ever you purchased at the time – you have to now buy, once again, an entirely new model.

The issue with this is, for many circumstances and users, many a 2012 model once upgraded to its max potential is less than 1/2 the cost, if not more so, than its newer equivalent.

That’s not being “cheap” or frugal per se, that’s just using plain common sense.

Apple under Cook’s tenure has now turned the once coined “Apple tax” into a means of outright extortion. And it’s pissing off many a person like myself.

I know music producers that were once avid Apple users (million unit selling producers, not basement types) that are absolutely furious and no longer use Apple hardware such as the one heralded Mac Pro® (aka “Trashcan Mac”) because of both the price, the inability to upgrade it, and – it is still the same model offered in 2013.

Again – a 2013 non-upgradeable post purchase piece of hardware at 2018 prices! (e.g., $6 – $7K if you max its hardware which is almost a prerequisite if you’re doing serious work and can’t afford the chance of needing that little “extra” once you’re well into certain projects.)

Their remedy? What’s now known as “The Hackintosh.” i.e., a PC based hardware platform that can run Apple software.

The issue with this current workaround which one knows ticks Apple off, as it should, is one that should be used internally as warning within Apple, not just some “gnat” that needs to be squashed. Or said differently…

How is it that one can purchase off the shelf hardware equivalents, if not better, or more robust than currently offered by Apple, and build, at home, with simple do-it-yourself skills something almost as reliable as a current Apple product? And, in some cases, for less than half the price?

Shouldn’t something of this nature push a company that was purposely designed to be “cutting edge” to use its resources to do the same, if not surpass what is currently available rather, than spending time and resources in finding ways to not allow its software to run on them?

Apple today appears to be mimicking the music industry’s way of dealing with issues rather, than the way Jobs showed the industry how to make music a better experience, while making more money.

And, let’s not forget – it was in that way of thinking that propelled Apple to have the resources which it capitalized on and helped propel it to where it is now.

Speaking of music: hows your experience with the newly updated iTunes®? Here’s mine: What a freakin’ joke.

This is supposed to be the place to interact and purchase all your latest and greatest Apple experiences of music and more. I personally can no longer tell if I’m looking at an Apple interface – or an old Yahoo™ page, along with about the same intuitiveness for interaction.

I’ll just give you one example: Try creating a playlist to use on your iPod. If you don’t create a new one everyday so that this “new” process becomes engrained enough to dispel the previous – it is not only cumbersome – it’s beyond stupid. e.g., to create a new playlist, you no longer just drag and drop – you now have to open a new window – to drag and drop. And, finding where that “action” is when you’ve been doing and using the same easy (and intuitive) feature and process for years, has been akin to a new adventure or exercise in “Finding Waldo®,” every – single – time. And this was part of the revamp and upgrade!

“But wait…” as they say on late night television, “…there’s more!” The issue here is – much more.

In 2014 I penned an article titled, “Did Apple Just Become Microsoft?” At the time this was quite the controversial statement in both business and finance. So much so that even Market Watch™ picked up on it in an article by Shawn Langlois in his “Call of the day” section. To wit:

And with the potential move to buy Beats, Apple could very well take the final step in its (d)evolution into Microsoft. That’s pretty much how Mark St. Cyr sees it. Of course, he’s not the only one piling on such a purchase. Music critic Bob Lefsetz calls Tim Cook a clueless operations guy. But St. Cyr takes it a step forward by comparing Apple to the lumbering software giant. In a “complete and utter cave-in to Wall Street,” Apple’s latest report wasn’t consumer-products based; rather, it was designed to play Wall Street’s game, he says.

“Dividends, debt, splits, and more,” he said. “I don’t think the iPhone has added as many new features at once as the new features released in Apple the stock.” That’s how Microsoft does it, said St. Cyr as he waxed on about the Apple you knew is no longer. “I hope I’m wrong, but the actions are beginning to not only speak for themselves — they’re screaming.”

As I said, in 2014, that was a very controversial call. How has that “controversial call” worked out these years later? Great question, and let’s use the same venue for its relevancy, shall we? For as Rod Stewart once crooned, if “Every picture tells a story, don’t it?” Then the following screenshot should tell one all they need to know in this current saga.

From an article in June of this year, again, to wit:

 

(Source)

Are you beginning to see the reasoning behind my current consternation?

As I alluded to in the beginning this entire frustration theme was borne when I was smack dab in the middle of a project, when suddenly, I found what I had thought (or believed) I could do easily – turned into one of the most frustrating adventures I could remember.

Rather than go into details about it, let me begin to bring what happened in stark relation to what Apple is now offering and the abject tone deafness, as well as alarmingly lack of innovation for the foreseeable future.

One of my issues was due to something which, once again, was a feature I believed was either still available or, at the least, would be easily remedied. To my utter bewilderment not only was this process not intuitive – it was if I was working still using a Windows Vista® platform. It was mind-boggling frustrating.

But as frustrating as it was is pale in comparison when I later gained my composure and viewed the highlights of the new releases coming via the recent Apple event.

To my amazement and complete disbelief, there was virtually nothing for Mac’s. New Mac Pro? Nope 2018-19 looks to be offering the same 2013 model. New products? Yes, new operating system or reboot. Issue? Just how many features will power users like myself lose, once again, as the product seems to get dumbed down ever further?

Want to see a demonstration into said absolute tone deafness? Here’s a quote via Apple’s Lisa Jackson as reported by BI™. To wit:

“…Apple’s Lisa Jackson said at Wednesday’s event: “Because [iPhones] last longer, you can keep using them. And keeping using them is the best thing for the planet.”

Here’s the issue I, as an avid Apple user and consumer, have with that statement:

During my escapade noted above I grabbed my older iPad (which I haven’t upgraded because, it still works for my purposes yet, my wife has the latest and greatest) when to my surprise as I ventured to the Apple Store® to research a possible fix using my current model – I was not allowed to even enter because, I now needed at least iOS® version 10 or better to even enter the store.

No, not that I could only look at the current offerings and just drool over them because, they wouldn’t work on my current model. No – you can not enter – be gone you now worthless past revenue pawn. Only 10’s or better enter here!” That was the impression for an Apple user with a house full of Apple devices is now treated.

Here’s what I have to say about the now “locked door” and the way I found it to be locked:

“Are – you – f’n  – kidding – me?”

It was during this time I was absolutely running around like a chicken with its head cut off trying to come up with solutions to a problem I deemed should not be happening in the first place on my Apple’s. Then – Apple serves me the equivalent of locking the front door of its store while I can see everyone inside perusing and more, and not only won’t open the door, but pulls down the shade in my face so I can’t see in to begin with.

So how does that type of “new” experience for someone like myself square up with Ms. Jackson’s idea of: they last longer so you can use them longer?

Hint: I immediately began looking at Window’s based platforms once again.

The reasoning was simple: This kind of frustration was why I jettisoned PC’s and switched over to Apple to begin with. But now? If this is how using Apple computers and software is now going to be and devolve? I might as well get this kind of frustration and only pay half the price – if not even less.

I’m not the only one who’s noticed that under Cook’s tutelage customer “innovation” has been replaced with Wall Street diligence. Here’s a recent observation (and summation) from Seth Godin via his blog. To wit:

“Apple became the first company to be worth a trillion dollars. They did that by spending five years single-mindedly focusing on doing profitable work. They’ve consistently pushed themselves toward high margin luxury goods and avoided just about everything else. Belying their first two decades, when they focused on breakthrough work that was difficult and perhaps important, nothing they’ve done recently has been either. Tim Cook made a promise to the shareholders and he kept it.”

I’ll just add, he’s kept it so well, as I stated earlier, even Warren Buffett is now a believer and a buyer. That alone should be all one needs to know in helping to understand where the Apple under Cook has deviated with the Apple of Jobs.

But with that deviation comes a very high, and too some, crippling price tag.

Jobs always exuded the aura that producing great products that people will pay up for, producing considerable net profit margins, should be the key focus – not the stock price. For if you did the former the latter would take care of itself.

Cook on the other hand seems to have done the latter, and if you live by the share price – you’ll perish by it also.

Back in October of last year I penned another article, again, asking some very pointed questions about Apple, in-particular about Mr. Cook, titled, “Are Tim Cook’s Days As CEO Numbered?”

This article made its way, once again, across the media. The difference this time was that not only did it make its way across almost all of the largest sites (i.e., it landed on the front page of the Drudge Report™ for just one) as we stand here today, we also have a bit of history to see if what I stated then may not have been as “crazy” as some first stated. But rather, is more in-line with what I like to explain as “Sometimes I have to remember where I’m standing is over the horizon to many, let alone, what I’m seeing from that standpoint.”

Should these “markets” suddenly come under extreme pressure borne out of some sudden upheaval currently under watch or, out-of-the-blue, the share price of the “priced for perfection” group of stocks currently known as “The FAANG’s” could find themselves in a place both they, as well as many a-current mainstream business/financial pundit never thought possible. i.e., Calls for CEO change to mitigate (in theory) any stock market carnage. Or, further and unrelenting carnage.

As I started off with the title of this article, I referenced Sony™, the reasoning was simple: The Microsoft comparison appears to have been met in far greater detail that I first thought. So why the Sony? Here’s that reasoning…

For those that remember right before the crash of the dot-com era, Sony was “the” and I do mean “the” brand name product that people seemed willing to pay up for with reckless abandonment. All it seemed they did during the late 80’s and 90’s was release newer versions of the same old thing. (Remember when “Trinitron®” was a thing?)

Now we have Apple offering new and improved name branding, and what do we get? “XR” and “XS” The problem here? It’s not XS meaning excess or, something seemingly intuitive. No XS is pronounced “Ten -ess” and XR is “Ten-are.”

Great branding, huh?

Oh yeah, and in what seems to be typical Apple fashion (pun not intended) once again, a new “coming soon” Apple device is missing in action. e.g. wireless Airpower© charger. Jobs was a fervent defender of what is called by many as “shipping.” i.e., actually delivering a product out the door and into a customers hand.

Now it seems it’s more like, Take a number and wait, then, wait some more.

And to put that “tone-deaf” statement I included earlier made by Ms. Jackson for even more comparison of what seems to be an absolute real-time example of what I’ve contended over the years about much in Silicon Valley? i.e., rarified air turned into exhaust fumes. Here’s the quote one more time. to wit:

“…Apple’s Lisa Jackson said at Wednesday’s event: “Because [iPhones] last longer, you can keep using them. And keeping using them is the best thing for the planet.”

So now, compare the above to what was not mentioned. Again, quoting from the aforementioned BI article. To wit:

“— Fans of other Apple products got hit with some bad news, and none of it was mentioned during the event. Apple quietly discontinued several devices Wednesday, including the iPhone 6s, the iPhone X, and the iPhone SE. The iPhone SE and the iPhone 6s were two of our favorite iPhone models and incredible values in their own right. The iPhone SE was notably the last iPhone with a 4-inch screen; those with smaller hands must now embrace Apple’s larger screens or look elsewhere, maybe even for a used iPhone SE.”

Are you beginning to realize why myself and others are beginning to become a little bit further over the edge of perturbed than we used to be?

I mean, are you now supposed to gamble away $thousands upon $thousands on the now going on 6-year-old Mac Pro  with maxed out 2013 specs, that’s not only an un-improvable or non-upgradeable hardware model meaning, that’s the best it’ll ever be, unless they release something newer tomorrow for you buy it all over again? That is, if they ever make a replacement for it to begin with, or worse, discontinue it all together. Or the worst of all worlds which they seem to be doing more of lately: Announce a newer and greater version – then – either delay or never deliver it to begin with. (Hint: see current Mac Pro for clues.)

Sony seemed to follow this same “marketing” gimmickry back during the 90’s. Maybe there was a reason for it. Let’s see if there’s any correlation we can conclude if we look back at an old “picture” of Sony’s share prices and compare them to Apple’s of today, shall we?

Once again, let’s view them as we hum that ole Rod Steward song, once again. To wit:

(Source)

On the left is Sony’s share prices represented via a Monthly bar/candle chart. On the right is Apple’s using the same.

So what’s the point of the two? Easy, as you can see looking at the lower portion, or X-axis, Sony’s share prices and “could do no wrong product cycle marketing” took place directly into the bubble now known as the “dot-com era.” Apple’s is much the same, only it is directly related (my conjecture) into the bubble known or coined as “the central bankers’ bubble.”

The problem with bubbles of any sort? Here’s another hint, again, to wit:

The best its (Sony share prices) been able to do since that prior “bubble” is get back to where it was when an even greater bubble that burst in 2007/08 now known as the “Great Financial Crash.” Again, all during what a few like myself point to as an even greater bubble now known as “Central Bank Fueled Mania.”

What does one think will happen to both Apple the stock, as well as a CEO that has made his name on that story should this “market” suddenly falter?

As always, no one knows, but if past is prologue, maybe the Sony comparison isn’t as far fetched as some may think at first blush.

Sometimes there are others that come to mind and make you think twice for comparisons. And then some, come from the most unlikely of sources. Here’s an example:

You know somethings doomed or, at least should be giving you clues that one should take heed, when the marketing and branding department puts forth a name or moniker for your product that will cause the need for everyone to endlessly correct everyone away from intuitively pronouncing from what they believe or, think it is.

To think the “ten-ess” issue wasn’t observed or noticed at the C-suite levels, but yet, allowed or reasoned off as “a good idea” tells me all I personally need to know. Case in point:

Does anyone besides myself remember, Ben Affleck or, Jenifer Lopez visible frustration where in nearly every interview they had to correct either the interviewer or, someone else, that their movie title was pronounced, “Gee-lee” rather than the intuitive Gigli or “jiggly.”

The result?  Let’s just say, now some 15 years later, a response of “What movie?” says all that needs to said.

I have a feeling XS pronounced as “Ten-ess” will join this pantheon of other innovation classics, right along with New Coke® and Betamax®.

But only time will tell. That, or a sudden “market” panic.

© 2018 Mark St.Cyr