iPhone SE flies off the shelves, yet production is “slowed?”

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by,

Suzanne Coleman

I decided that I wanted to buy the iPhone SE, so I went to the store to check it out and make sure it offered the features that I wanted.  While its camera isn’t very good and the 4K video looks ok, on a tiny screen, it did have dictation capabilities  which I think will be great for writing my books more efficiently (though Apple gets to screen everything you say, wonder what the fine print is on that??  NSA….).

I asked the store representative if they had any of the rose gold (I call it pink) 64 G in the store and she said they were sold out.  They’ve been mostly sold out for weeks.

Hmm…

If this is the case, then why are news outlets reporting a pull back on production of the iPhone?  Is this information accurate?  It seems to have been, in the past, when similar reports were released in the US.  This report was very vague though.  There were no indications of which phone/s’ production was/were slowed.  Maybe they slowed production of only certain models, like the iPhone 6.  Apple is expected to release the new iPhone 7 this year, so it would make sense if they decreased production of last year’s model, no well-managed company (not that they are…) would want to have tons of unsold overstock.

I asked the store’s staff how could I find out when they have the phones back in stock.  They told me that I could use http://www.apple.com to select the phone I want, and then I should hit “check availability” to see if the store has it.  So when I went home I tried this.

On Saturday, a couple of days later, most of the stores in my search results (about 15 stores) had the phone.  But the next day, all of the stores in my area were sold out.  I repeated this search over the next 10 days or so and none of the stores seemed to receive a new shipment (poor management…).

This is “vaguely” familiar, Apple not fulfilling customer demand.  Now as a stock-holder (not sure for how long that will continue), I have a problem with that.  You can’t bring in income if you don’t have the product available.  Apple has had so many issues with this over the past decade or so, yet management is the same as far as I can tell.  There is clearly demand for the phones, but there are no phones to fulfill that demand.  Why?

Then we hear that they are slowing production.  If that applies to SE, are they saying they made a mistake in selling this phone?  Do they want to pull back on it for some reason?  I don’t know.

I finally decided to order one for delivery, it “only” takes 3-4 weeks, though the website said 2-3, the dates were 3-4, another oddity.  So here I sit, iPhone-less for now.  Typing this article with my own two hands.  The old-fashioned way.  Man are they tired.

Why do I mention all of this?  As a shareholder the stock has performed poorly over the last year.  This company makes billions in profit annually (well, quarterly) yet investors are losing money.  Something needs to change, and as an analyst, I see the issue being at the top.  Management isn’t making the best decisions when it comes to production, sales and distribution.  There are also innovation lags compared to the competitors.

Maybe those nay-sayers were right, in fact they were, the stock was $135 and now it’s around $105.  That my friends, is not how you want to invest your money.  Waiting for a turn-around may be a long wait.  Maybe it’s time to take the losses and invest in another business…

 

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Bernie Madoff, Another Sociopath?

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“Inmate of Elmira Reformatory showing four views of head”. H. Havelock Ellis, The Criminal. See page for author [CC BY 4.0 (http://creativecommons.org/licenses/by/4.0)

 

by,

Suzanne Coleman, MD

Since we’re on the topic of sociopaths and psychopaths lately (being that this is the biggest issue in governments, big banks, wall street, wars, ect.), let’s talk Bernie Madoff.

Over the last two days ABC has aired a mini-series about his massive Ponzi scheme which they say defrauded investors out of fifty billion dollars.  Yes, you read that right, fifty billion dollars.  Wow.

He was arrested for his scam and is now in jail for the rest of his life.  Apparently there have been 61 additional Ponzi schemes discovered since this occurred in 2008.

As a human behavioral analyst who has been studying people with personality disorders (psychopaths) over the last ten years or more, I find it important to discuss how things like this happen, so that we as a society can try and avoid having them happen over and over again.  Or at least, some of us can learn to identify psychopaths before they take all of our money, or harm us in any way.

The TV mini-series revealed several behaviors of Madoff that led me to think that he has several personality disorders or strong traits.  The obsessive attention to his watches and the order of his table-top possessions is seen in obsessive-compulsive personality disorder (OCPD).  But what isn’t as easily seen, but is also a part of the same mental illness, is the obsessions over things in one’s mind.  For example, the show discusses his need to continue to raise the number in his fake account.  This is a type of obsession.  He also appeared to have obsessions over gaining people’s trust and having them believe in his manipulations and lies as he smiled to their faces.  The lies and manipulations, especially accompanied by what I have coined as “the sociopath’s smile” or “the psychopath’s smile” are all signs of a sociopath or other type of psychopath and I have never observed them in anyone else.

Madoff’s situation as portrayed in the movie was almost like a high-stress balancing act, him standing on top of a triangular rock, trying not to fall off.  This represents his obsession with increasing his accounts at all costs.  I wonder if he even enjoyed any of the money he stole, probably.  The show did not reveal much of that side of his life.  It did show however, that his obsessions caused him to lose one of his son’s love early on, and the rest of his family appeared to follow after his crimes were revealed.

The other sociopathic behaviors that were shown were seen in how he tried to bully and control others around him.  This control issue can also arise from the OCPD.

He also treated the people around him like pawns, buying them off, buttering them up.  All to continue the scheme.  He was shown receiving a nice present from his top worker, and then turning around and giving it away to someone else.  He viewed his employees as pawns, not friends, which after decades, is a bit odd.  Or, you could say psychopathic.

He seemed to have no emotions regarding other people and their lives, including his own sons, though this was a movie and I can’t say if any of what they showed is or is not true.  But this lack of empathy towards others is a classic sign of a sociopath.

The other personality disorder (PD) or trait that they mention is narcissistic PD.  He is very abusive towards others at times when they don’t comply with his every whim and demand.  This can be due to narcissistic PD where a person’s mental illness precludes them from understanding that they are not the center of the universe and that other people have feelings and priorities of their own that have nothing to do with the self-centered psychopath.  This overlaps with the sociopath as they have no feelings so they cannot understand how their behaviors harm others.

How did this man’s mental illness impact society?  It harmed his family extensively, as would happen in any family with a sociopath.  One in 75 men, and one in three hundred women is a sociopath.  One in seven people or less has a personality disorder of any type.  Identifying and treating anyone and everyone with mental illness will only help everyone around them and I strongly recommend seeking help from a qualified therapist to start.

In addition, the show said that over 20,000 people were scammed by Madoff, and that more than 30,000 additional claims were still waiting review to see if they were also valid.

A whistleblower of sorts reported the scam to the SEC several times over the years, starting in 2000 or 2001.  According to the show, the SEC employees did not do their jobs and the scam continued and harmed more and more people.  Since much of the lost money has still not been recovered, those people impacted should consider hiring an attorney to ask them if the SEC can be held negligent in their losses.  If so, they may be able to require them to repay any monies lost since the initial whistleblower report was filed with them.

So many people have a personality disorder, or more than one like you see in this movie about Bernie Madoff.  It can be people you work with, people you live with or near, people who run your banks, your religious groups, your non-profits, your hospitals, and your government.  Isn’t it worth reading up on how to identify them?  I think personality disorders may be the biggest social issue of our time.

 

 

Reasonability

If you keep playing with that, you're going to get hurt. © Suzanne Coleman, all rights reserved.

If you keep playing with that, you’re going to get hurt.
© Suzanne Coleman, all rights reserved.

by,

Suzanne Coleman

Is that even a word?  I have been wanting to ask the stock trading community this:  what is reasonable, and what is not?  Let’s talk PE.

I started trading during the “birth” of the internet, basically when companies that utilized it for profit were being born and growing, and the computer industry came along with them hand-in-hand.

At this time, people were piling into technology stocks, why wouldn’t you, when all they do is keep going up?  PEs were insane, or that’s what the older generation told me.  They were normal to me 🙂  I was told that a good, stable company should have a PE of 7 or 8, and a high-growth company might be safe at a PE of 15.  Hmm…

Well, in the internet days, a good stable, safe company would have a PE of 30.  An insane company that everyone wanted to own (was it cool like an iPhone?) might have a PE of over 100, up to, gosh I can’t even remember for sure, but probably up to 500-700.  Yeah, like I said, it was insane.

So now, almost 20 years later, I am looking at stocks again, some of the very same stocks I watched or owned back then, and trying to adjust to today’s market psychology and culture.  It’s hard.  Here is why.

Let’s start with a biggie, Amazon (AMZN), wow.  Well, I had that sucker for a really long time, I believed in it, I thought this damn company has a great idea, it will change the world.  Well, it did…  But its stock price fell along with many other great stocks during the “hell freezes over” period of my investment history.  That was in the early 2000s if I recall correctly.  So, I was holding on to it, it was once maybe $350 or so, and then came down to maybe $84.  Finally I decided to sell it, I was being too LOYAL (big issue to avoid), holding on to it, hoping it would eventually return to its glory days.  Well, then, of course, it did rise back up after years of just sitting there like a lump on a log (while I waited), and now it’s back up to over 300, and has even been at 400.  Wow.  If only we could predict these things…

So here’s the rub, AMZN is now at 310 with a PE of… ok, I guess they are now losing money so the PE is not listed.  Not too long ago, it was in the hundreds, maybe like 600?  My question to you all, is this, why would you continue to buy up a stock that is seriously over-valued?  I mean, you could lose almost all of your money if it drops down to where it should be.  It seems a bit like drug-induced insanity to me… what am I missing?  Have I gotten too old for this?

Then on the opposite side of the insane spectrum, let’s look at Apple (APPL).  They just reported earnings that were 38% over expectations.  No big deal, right?  Because we all know that Apple has a great history of blowing away even the highest of earnings expectations.  Are we nuts?  Maybe.  Their PE before this data was factored in was about 17.  Pretty reasonable for a company that is still growing and spreading into places like China, with over a billion tech-hungry citizens.  Why not buy Apple?  I’m not sure when Apple became this generation’s IBM, but that’s what it looks like has happened.  Almost no activity on the earnings news, or before it.  Odd.  The 12-month target will be revised upward and the stock price will go up with it.  So, you would think there would be buying now.  Maybe they are expecting a dip tomorrow or this week.  Maybe they fear… any of many things which may impact this activity.  But if you conclude it’s an overall conservatism, it is not.  See… Netflix (NFLX).

Netflix also reported better than expected earnings, just a few days ago (and I really should have bought it when I thought about it at 380, damn…) and is since up over 20%.  Their PE is over 100.  Hmm…  yes, they are also expanding into areas around the world, which is smart, but to buy in at a PE of 100 or more, isn’t really that smart.  I wonder if the “reason” that people do this is that they think it’ll (like Amazon and Yahoo! used to) keep going up, and if they don’t buy in now, they’ll never get to own a piece of it at these prices.  And, so far, in this instance, well this week, they’ve been right.

Look back a few months and you’ll see, well, let’s go to a 12 month chart… you can see that Netflix, like many other stocks these days that seem to do well, has been all over the place, with prices rising and falling significant amounts.  There is a high risk of buying in at a high point, and riding it all of the way down into the subway station.  And then, if you choose, you can end up waiting there for a plane to show up and fly you back up into the clouds.  Dramatic?  Yes, it can be.  There can be tears, there can be exhaultation (literally), so how and when do you decide to jump on a train and see where it will take you?

Let’s go back to Apple.  Strong growth, strong earnings, stable company, good leadership.  Since other big, stable companies are reporting earnings declines and less-than-enthusiastic forecasts, wouldn’t you expect more investors to move their money into Apple and out of those losers?  I mean, growth and stability, how can you go wrong with that?  We’ll see what happens.  I know that most big investors are already in Apple, that may be why there hasn’t been much movement today after earnings were reported to the public.

So what do you think?

 

 

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