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Subject:  Re: say no to financial engineering distractions Date:  11/1/2013  4:20 AM
Author:  NailThatJello Number:  197698 of 208445

they could just come out and say "well, we have big plans for that cash, but for competitive reasons, we can't share any of the details with the public".

Interesting suggestion.

I recall they actually did this once, in the late Jobs years. Steve said something at a conference call like "we're holding onto the cash for possible major acquisitions or investments" (not his exact words). Time has passed, Steve has passed and this reason may not still hold, but I wouldn't declare it invalid without evidence otherwise.

One reason they may not be commenting further on this is that it really says little and only invites further speculation. Aha! They are going to make a giant acquisition! Can you tell us what sector, Mr. Cook? Ok just a hint please? Ok well tell us if it's not 'this' or not 'that'... blogosphere in a tizzy, etc. It rarely does a corp any good to signal its intentions to spend money in any direction, even a vague one.

Based on 1) the near-impossibliity of actually spending $100,000,000,000 of cash

Let's say for example, and of course this is sheer speculation, that their secret strategy was to buy Disney in order to break through the content owner's moat that has so far stopped Jobs' vision of a whole new approach to TV. Disney's market cap is $123 billion. Wow, suddenly Apple's $100 million doesn't go as far as we thought...

Again iTV is just a hypothetical example and may not be the one they go for so I am not arguing for that as the real thing. There are many other expensive forays that could be imagined, or a combination of multiple forays. Actually I think the latter is more likely because Apple would probably not want all of its eggs in one basket. The point is, even $100 billion is not as much as we think it is when talking about revolutionizing major industries.

Based on 1) the near-impossibliity of actually spending $100,000,000,000 of cash

Apple is now a very big company and to make a dent in the universe it has to hit home runs with the bases loaded. Big home runs require a big hitter and a big bat. That is my guess why they want to hang on to that cash pile. But of course they have not told me or anyone else.
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