With today's cap-arb market frenzy focused on the latest development out of Cupertino, where Tim Cook moments ago announced that Apple's Goldman-syndicated bond issue would be $17 billion, the biggest ever for a corporate issuer (basically representing a circular cash flow stream where hedge funds give AAPL cash, so that AAPL cash pay them cash in return), some are wondering: is locking in a sub-4% yield for 30 years the best idea for a company which may not exist long before that? And with the stock recently having crushed the Apple collective, plunging 40% from its all time highs in a few short months, leaving many bottom and momentum-chasing hopefuls explaining just how they get to throw good monopoly money after bad monopoly money time after time, some are looking at alternative means of expressing their affection for the computer/cell phone/tablet company preferably coupled with a juicy ROI.
One such suggestion comes from Germany's Auction Team Breker, which last November made news for selling an original 1976 Apple I computer for the world record price of $640,000 (€492,000). Considering the Apple I originally sold for $666.66 in 1976, this represents a jawdropping CAGR of 20%+ over 37 years, a return which trounces virtually every other asset's return over the same time horizon, or most other time horizons.
Presenting the implied appreciation of an original Apple I purchaed in 1976 through to its auction closing price:
On 25 May 2013 collectors, capital appreciation chasers and Apple-aficionados will have the chance to buy another of the 6 surviving Apple I computers still in working order. Expected price $260,000-$400,000.
Since there were only 200 made, the scarcity and sentimental value of the otherwise completely useless piece of hardware is ensured forever. Whether the price will continue to rise at a 20% annual pace is unclear although if the pace at which central banks are injecting liquiduity in perpetuity in the market, all of which ends up for purely speculative purposes is any indication, this 37 year old computer may be a far better bet for capital appreciation, even if, like gold, it can't be fondled, and it has no dividend.
And if owning a really, really expensive paperweight with sentimental value is not one's cup of tea, Breker has many other products for sale at what it calls an auction of "firsts." Among these:
- the world's first "Intel 4004" microprocessor in a 1971 "Busicom-141PF" (Euro 8.000 - 12.000 / US$ 10,000 - 15,000) and the first major Personal Computer, the "Altair 8800", which kick-started the PC revolution from the cover of Popular Electronics magazine in 1975 (Euro 3.000 - 5.000 / US$ 4,000 - 7,000).
- Three hundred years before the birth of Steve Jobs & "WOZ", French physicist and philosopher, Blaise Pascal, was designing the first commercial mechanical calculator. The "Pascaline" of 1652 could add and subtract two numbers together; multiplication and division relied on the 9's complements principal still used in computers today!! Because of its importance to mathematics, 9 machines still in existence are all in museum archives. The 10th is being offered here at auction (Euro 100.000 - 200.000 / US$ 130,000 - 260,000).
- In the late 18th century, poor roads and coach travel led English inventor James Watt to build his portable copying press: the first multiple-copying machine and the first patented instrument too (Euro 3.000 - 5.000 / US$ 4,000 - 7,000)!
- A century later, and on the other side of the British Channel, mechanical life was being designed to amuse and be admired. Luxury Parisian toy makers of La Belle Époque combined music, mechanics and magic in the creation of automata like Gustave Vichy's "Marchande des Masques" (Euro 30.000 - 50.000 / US$ 40,000 - 65,000), perhaps inspired by Monet's portrait of his wife Camille as "La Japonaise".
- Functionality came to the fore again in the 20th Century with mechanical encrypting devices such as the iconic second world war "Enigma" with codes so complex, its inventor claimed, it would take a code-breaker, working day and night, 42,000 years to exhaust them all (Euro 15.000 - 25.000 / US$ 20,000 - 33,000).
- Also included in the auction are historic telephones, antique typewriters, telegraphy and all manner of technology. Says company founder Uwe Breker, "this sale is unique in presenting masterpieces from the spectrum of antique technology, from the 17th century to the 21st."
Full auction details here
And for those who just must have a piece of the original Steve Jobs, here is some more on the Apple I auction.