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Is the iphone helping the US economy?
- Thread starter B.King
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Umm, anyone can buy stock dude... but the people affected by the economy can't afford to buy stock.
It's quite obvious by your responses that you can't appreciate this.... probably because you aren't affected by it directly, or as much as those in the lower class bracket. To be honest, i cant understand why YOU don't understand.... and i can't explain why you can't understand so I won't try.
Just know, that it really does sound like you fall into that group that's part of the reason our economy and country is in it's current situation.
Knowledge is power, and you need to read some books.
the economy is down yes... My only question is apple helping. I think you need to learn to look at it with a more opportunistic attitude. Its either hurting or helping. When you say it does not help. You are saying it hurts. I want to know how it hurts I guess.
That's one of the stupidest things ive ever heard.
It's either hurting or helping???? Are you joking? HA! It's doing NEITHER. It's not helping the economy, and it's not hurting the economy. Yes, i know it's difficult to comprehend, but there are things that give no benefit, and cause nothing negative.
If Apple were a very small company, that was owned by someone who was lower to middle class, and THEN the company took off like a rocket and did well..... THEN it would be helping the economy to buy from this person. In fact, if you buy from only mom and pop shops from now on it will help stimulate the economy....
but buying from an already billion dollar company, does not help the economy.
Sorry man, you lose.
but buying from an already billion dollar company, does not help the economy.
Sorry man, you lose.
Lol. Drivel.
B.King makes more economic sense than you.
There are many other countries that still have a great economic situation right now. Most of the ones in a difficult time, have been like that for 10+ years... the United States is one of the only recent countries to go from good to bad in a matter of about 5 years. Well, in the last 5 years anyway.
Nice comment, I can see that you've thought this out by the length of your response. I love where your going with this. I bet you own some Apple stock, huh?
No, I don't own Apple Stock. It's very simple really. Either consumption is contributing to GDP growth or it isn't. If Apple stimulates consumption, then it's helping the economy. The overall effect might be minuscule, but the economy is the aggregate of all these minuscule effects. Given the growth in consumer demand for the iPhone, the answer is pretty obvious as to whether the iPhone is "helping" the economy or not. Of course it is, but it's also a pretty meaningless question.
Agreed, except for the helping the economy thing. I suppose it depends on which countries economy you're talking about. It is certainly in no way shape or form specifically benefiting the united states economy in a way that will help change the economy. Does it have a positive effect? Sure.. but is it helping to improve the economy? No, not really. It takes different types of changes to do that... and buying an iphone from apple isn't helping.
ummm I'm almost speechless. But I will just add that there is an obvious difference between "ability" as an idea and "ability" as a practicality. At least in the sense of being "able" to buy stock I hope it is obvious??? But maybe you are right... I really should go give that single mother over there some solid financial advice and tell her to invest her entire month's earnings on some apple stock because perhaps it will skyrocket next month? I mean, what else does she have to spend it on??? (I know she's probably addicted to drugs or something, aren't all single parents?)
pardon me being facetious there. You know what grandma said "if they don't pay the rent, kick em out!" speaking of which... {lifts up one butt cheek}
I find, that you can either talk sense into someone.... or talk sense at someone.
We're only going to be able to talk sense at these guys, because they're refusing to let it in. lol
A "positive effect" is the same thing as "helping" in my lingo. If you want to define "helping" differently by saying that only structural changes to the U.S. economy count, then it's mostly semantics, not economics.
Except Apple products are made in China. Want to help out? Stop buying ethanol added gas or write to your local congressman/woman to quit putting that crap in until we farm something other than corn for it.
Apple products may be made in China, but as veteran China observer James Fallows pointed out in The Atlantic, most of the value in the products accrues to companies like Apple (whose value-addedness comes from design, technology, &c.) -- and not to Chinese manufacturers. Manufacturing is part of the chain, but a very low-value part of it. It's no longer about the raw materials, or how much it costs to put together. It's about the ideas, concepts and artistry that made it possible in the first place. That's where most of the money goes to.
LoL... you're something else man. So by your theory, we're giving united states money to china for ideas.
I'm going to try and bring this discussion back to the original question about the iPhone helping the economy.
First a few assumption:
1. the economy is cyclical, and closely follows the business cycle IN THE SHORT RUN ( expansion, peak, recession, trough, recovery, expansion, ... )
2. economic growth is function of growth in real GDP (Output) per capita
3. GDP (or output) = Consumption + government spending + investment + net exports
4. The definition of investment is the creation of capital stock NOT purchasing shares
that means that Apple building a new plant, and purchasing a machine to make the iPhone an investment, where as the purchase of share in Apple inc. is the practice of saving and loaning funds
5. It should be noted that purchasing Apple shares does not influence how much money Apple has to use since the shares purchased on the stock market are not directly from Apple but rather some other party
meaning: that the only way Apple will see money from you purchasing shares is if they issue new shares onto the market in form of an offering <-- which unless you have a significant net worth, you will not be granted access too.
6. an economic expansion is defined as GDP exceeding the previous high of GDP in the last cycle.
NOW
what do we know about the iPhone
people are buying ... SO the consumption portion of GDP is increasing. Apple had to buy some new machinery or modify the existing ones to manufacturer the iPhone. However, if I'm not mistaken it did so in China, so the investment portion of GDP most likely was not influenced.
the iPhone is sold globally, so it is an export, this in turn had a positive impact on GDP.
I don't know what the Government did for apple (Note: subsidies, and tax breaks are not considered spending in terms of GDP).
With all these assumptions answered about GDP
one would conclude that the iPhone had a positive impact on GDP
However. Is this a time in the economy where people should be consuming more, or saving more?
buy saving, you are increasing the supply of loanable funds, which in turn can be used by those that need money in order to build capital stock to produce more.
consumption increases prices, which leads to inflation, inflation leads to a greater demand for money, greater demand for money, means that there is less money in the system available for to borrow for firms looking to build capital stock. A decrease in money supply, will cause an increase in interest rates, and increase in interest rates is a disincentive for firms to borrow and don't make capital stock. less production causes less people needed for jobs, this increases unemployment.
OKAY -- i could go on like this hundreds of pages.
next, lets consider How much the iPhone will really impact GDP --
how many units will be sold? 10 million? 50 million?
a quick Google search revieled that Apple has sold 88 million iPods world wide since Generation 1 - that's over 6 or 7 years?
http://news.ecoustics.com/bbs/messages/10381/336208.html
lets be overly optimistic and say that every person runs out, replaces their iPod and buys an iPhone and lets say that apple sells 100 million iPhones in that same year, and for easy math, let say they sell 35% in the first year
so 35 million iPhones at an average price of 300$ will be $10 billion in sales -- considering that Apples gross sales in 2007 for ALL of there products was 24 billion -- we are being very optimistic -- but lets say it happens
US GDP in 2007 was 15 Trillion, that's 15,000 billion -- which would make the iPhone account for roughly 0.0007% of the entire GDP? and let's say that the iPhone has such an impact that all the companies affected by the iPhone, (cell carriers, app developers, carrying case manufactueres) 10 fold ... that still only makes 100 billion in sales, and so now it is 0.007% of GDP.
Will the iPhone have a positive effect on the economy? if it does, it will be so marginal that it wouldn't even be a blip on the national balance sheet.
best
First a few assumption:
1. the economy is cyclical, and closely follows the business cycle IN THE SHORT RUN ( expansion, peak, recession, trough, recovery, expansion, ... )
2. economic growth is function of growth in real GDP (Output) per capita
3. GDP (or output) = Consumption + government spending + investment + net exports
4. The definition of investment is the creation of capital stock NOT purchasing shares
that means that Apple building a new plant, and purchasing a machine to make the iPhone an investment, where as the purchase of share in Apple inc. is the practice of saving and loaning funds
5. It should be noted that purchasing Apple shares does not influence how much money Apple has to use since the shares purchased on the stock market are not directly from Apple but rather some other party
meaning: that the only way Apple will see money from you purchasing shares is if they issue new shares onto the market in form of an offering <-- which unless you have a significant net worth, you will not be granted access too.
6. an economic expansion is defined as GDP exceeding the previous high of GDP in the last cycle.
NOW
what do we know about the iPhone
people are buying ... SO the consumption portion of GDP is increasing. Apple had to buy some new machinery or modify the existing ones to manufacturer the iPhone. However, if I'm not mistaken it did so in China, so the investment portion of GDP most likely was not influenced.
the iPhone is sold globally, so it is an export, this in turn had a positive impact on GDP.
I don't know what the Government did for apple (Note: subsidies, and tax breaks are not considered spending in terms of GDP).
With all these assumptions answered about GDP
one would conclude that the iPhone had a positive impact on GDP
However. Is this a time in the economy where people should be consuming more, or saving more?
buy saving, you are increasing the supply of loanable funds, which in turn can be used by those that need money in order to build capital stock to produce more.
consumption increases prices, which leads to inflation, inflation leads to a greater demand for money, greater demand for money, means that there is less money in the system available for to borrow for firms looking to build capital stock. A decrease in money supply, will cause an increase in interest rates, and increase in interest rates is a disincentive for firms to borrow and don't make capital stock. less production causes less people needed for jobs, this increases unemployment.
OKAY -- i could go on like this hundreds of pages.
next, lets consider How much the iPhone will really impact GDP --
how many units will be sold? 10 million? 50 million?
a quick Google search revieled that Apple has sold 88 million iPods world wide since Generation 1 - that's over 6 or 7 years?
http://news.ecoustics.com/bbs/messages/10381/336208.html
lets be overly optimistic and say that every person runs out, replaces their iPod and buys an iPhone and lets say that apple sells 100 million iPhones in that same year, and for easy math, let say they sell 35% in the first year
so 35 million iPhones at an average price of 300$ will be $10 billion in sales -- considering that Apples gross sales in 2007 for ALL of there products was 24 billion -- we are being very optimistic -- but lets say it happens
US GDP in 2007 was 15 Trillion, that's 15,000 billion -- which would make the iPhone account for roughly 0.0007% of the entire GDP? and let's say that the iPhone has such an impact that all the companies affected by the iPhone, (cell carriers, app developers, carrying case manufactueres) 10 fold ... that still only makes 100 billion in sales, and so now it is 0.007% of GDP.
Will the iPhone have a positive effect on the economy? if it does, it will be so marginal that it wouldn't even be a blip on the national balance sheet.
best
As someone that invests in Apple and regularly engages in forums on the stock market and Apple, I can provide some info to guide your thinking:
AT&T buys the 8GB iPhone 3G from Apple for $500 and the 16GB for $600.
AT&T then subsidizes the phone and sells it to consumers for $199.
It has been estimated by many tech websites that it costs Apple about $170 per phone to make the phone (including licenses). $500 - $170 = $330 profit per phone. (about $400 for the 16GB).
-If Apple sold one million phones during the opening weekend, that means Apple brought in $330 Million in Profit.
Most Apple investors live within the United States. Aside from those who invest in Apple, consider all of the Apple employees that are employed.
-BUT THERE IS SOMETHING THAT WILL HELP THE UNITED STATES FAR BEYOND THE INCIDENTAL EFFECTS; THE CONSEQUENTIAL EFFECTS OF THE IPHONE; just as the advent of the Internet and networking in the late 1990s led to a boom in productivity, the iPhone will also increase productivity, as Americans will be able to access information whether they are in the office or out of the office - productivity will be enhanced.
AT&T buys the 8GB iPhone 3G from Apple for $500 and the 16GB for $600.
AT&T then subsidizes the phone and sells it to consumers for $199.
It has been estimated by many tech websites that it costs Apple about $170 per phone to make the phone (including licenses). $500 - $170 = $330 profit per phone. (about $400 for the 16GB).
-If Apple sold one million phones during the opening weekend, that means Apple brought in $330 Million in Profit.
Most Apple investors live within the United States. Aside from those who invest in Apple, consider all of the Apple employees that are employed.
-BUT THERE IS SOMETHING THAT WILL HELP THE UNITED STATES FAR BEYOND THE INCIDENTAL EFFECTS; THE CONSEQUENTIAL EFFECTS OF THE IPHONE; just as the advent of the Internet and networking in the late 1990s led to a boom in productivity, the iPhone will also increase productivity, as Americans will be able to access information whether they are in the office or out of the office - productivity will be enhanced.
I have stayed out of this until now, but I think you americans don't actually realise how good you have it in terms of oportunity. I also disagree with you in how people can help themselves.
I for example hardly ate and didn't go out for nearly 2 years in order to get the proper training and experience I needed to up my career and still be able to feed my family. Other people that I used to know are quite content to moan about not having money but do nothing about it. I'm not saying it's easy, but it can be done with the right will and determination. The cream does rise to the top. I'm also not saying I have done it as it's early days yet, but at least I am making the effort.
I will admit that I was blessed with a decent home and a reasonable base education, but I still believe there are chances to advance with the right motivation.
Ps. the reason your country(and most of the world) is in the situation it is in due to some very poor lending decisions and people with a buy it now and pay later attitude. Thats all fine so long as you can pay it back, but people borrowing $$$$$$$ in order to buy a bigger house and bigger car that they can't afford when they would have finished paying off their old stuff by now.
Please don't start this argument. I am sure that you dislike the single mothers who have 5 kids by 5 different fathers and is on welfare for the next 20 years. I have no sympathy for people like that. The kids I do have sympathy for and alas they will grow up in the same mould.
Yes you get the single mothers that work hard etc and those are the ones the state should help. I don't know the welfare laws in the states, but here in the UK you are penalised if you are English which is have the unfortunate side effect of feeding the right wing plenty of ammunition.
Politics eh?? ;-)
Wow, you make absolutely no sense, but thanks for posting some crap rant to fill up space and increase your post count.
NICE! I think YOU have an issue with people from the United States in general, perhaps that's the reason for your attack on our countries people.... hmm?
You have just lumped everyone from our country into the same boat. According to you, all of our people are in the same financial situation... wrong.
DUMB.
Thank you, for a well written and well thought out response. I agree, 100%.
So, no benefit... or at least not one that will matter or show improvement.
You are right. He doesn't. You are also right that the american economy is shifting to a more service based economy. That is pretty much what we have here in the UK. We don't really manufacture anything anymore. I'm not saying it's good or bad, but noone can compete with India and China manufacturing wise....at the moment. Remember they don't have unions, holiday pay etc...driving up labour rates.
In short ideas and services are worth more money than manufacturing. Look at marketing and advertising companies. They sell ideas.