My latest appearance on RT's Capital Account last night brought about many topics that are making headlines today. Reference the video at the 3:20 and 16:05 markers.
Arab influence and the worsening EU situation
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Yesterday, I made announced that Abu Dhabi & the UAE Can Leverage PetroDollar profits to capitalize on the plight of EU nations. [16] This is becoming more and more true day day as these quasi-"sovereign" nations become increasingly forced to part with strategic and financial assets to pare debt. I explictly stated that Greece would have to either default or restructure again, possibly immediately after the default/restructuring that took place week before last, rendering the entire exercise moot nad relative useless (it did kick the can down the road for a few quarters). See Beware The Overly Optimistic Greek Speculators Fall Like Icarus From the Sky in Flames, [17] then realize that after reading the BoomBustBlog piece we have the ever reliable ratings agencies following suit - reference this piece from Bloomberg: Greece May Have to Restructure Again, S&P’s Kraemer Says [18].
Of course, we all know how reliable and timely the rating agencies are, right? See Rating Agencies vs Reggie Middleton, Part 3 [19] and the Interesting Documentary on the Power of Rating Agencies, with Reggie Middleton Excerpts [20]
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I am having my analysts work on the Spanish and Italian default/ bailout scenario now (we have worked up a scenario two years ago, but things are much worse now). Even a Citi analyst has chimed in to that effect [22]. Let' not forget the Portuguese Liquidity Trap: Prime from the actions of Greece [23]. As a matter of fact, it's evident that Greece Is Trying To Convince Portugal To Make FIRE Hot [24], hence I answered the inevitable question, So, What's The Next Step Towards The Eurocalypse??? [25]
The continued Apple lovefest conceals key facts
The MSM is still engorged on its lovefest with Apple, comparing the latest iPad 3 to the Transformer Prime (my current workhorse tablet) favorably, despite the fact that the Transformer runs circles around it in almost every category. Notice the comments from those who have actually used the Transformer [26], which was consistently sold out for a reason. The fact is, at least from my own research and personal observation, Apple's iPad Is Losing Market Share As Margins Compress (Click this link for the research behind this assertion) [27]:
Again, as with the smartphones, the Android tablet tech is superior to that of iOS products and as iOS normalizes the difference, margins will suffer. Margins will drop (is dropping) faster for tablets because prices are coming down as fast as tech is increasing.
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Apple's Decision To Return Capital to shareholders [29] is an indication that it feels the capital is put to better use in the shareholder's hands than that of management using it to actively grow. Granted, the amount is de minimus in the grand scheme of things, but the move marks a transition away from Steve Jobs' mantra immediately after his departure.
Now, we have other analysts jumping in the BoomBustBlog bandwagon, after the fact of course...
Apple Inc. (Nasdaq: AAPL [30]) is weak this morning and according to some this could be related to a negative research note at Wedge Partners.
According to tweets from Notable Calls, the analyst said:
"Taking the Sidelines Until March Qtr Report on Possible iPad Slide"
"We're concerned iPad sales may not be as strng as expectations, and we believe March cld disappoint."
"Full year production iPad expectations/forecasts may be pulled down as a result."
"Looking at overall demand picture, there doesn't appear to be much of a frenzy for the new iPad."
"The stock may be priced for perfection at current levels, but we feel we are seeing some scratches on the glass"
Our Apple analysis is now available to subscribers Apple Margin & Valuation Note [31] (those who wish to subscribe should click here [32]). This is a more comprehensive, more "scientific" update and approach to our piece from last year Apple - Competition and Cost Structure [33] and contains extensive valuation scenarios considering several what if scenarios for Apple, including the likely events that I've been warning of for some time now. Next week (this was pushed back two weeks due to my middle east excursion), pro subscribers will see a downloadable version of the model behind this that will deliver more Apple stuff than you can ever digest in one sitting.