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Turning Wall Street into 7-Eleven is not the wisest way to invest
Dennis Wyatt
Dennis Wyatt

Apple’s sales have dipped a bit.

The reaction was as if the company Steve Jobs built was about to go the way of blacksmiths.

It was also a sign that we are taking too many bites out of the proverbial poison apple of our times — seeking outrageously high short-term profits over steady, long-haul returns.

Apple, despite not selling a gazillion more i-Phones in 2018 is still turning out the most profitable smartphone units on the planet. Nobody comes even close to making as much profit per smartphone sale as Apple. And the fact they have a relatively closed app system — think buying a vehicle that only can be served by technicians with specific skills that the dealership you bought it from has — they keep income coming in after the initial sale.

Apple is not at the start of its death throes. At the same time, they need to keep innovating like everyone else does or else they might find themselves relegated to Blackberry status in 10 or 20 years. Apple is not going to exist forever nor is it going to disappear overnight.

The real issue is how we expect companies to perform in 2019. No longer does profit matter as much as building stock value. Dividends are for chumps. Today’s investor mentality is making money by constantly trading stocks. Nothing is long haul anymore.

At the core of what is taking down PG&E was an executive suite decision at 555 Beale Street in San Francisco nearly 20 years ago that they wanted in on the new Wall Street action. Companies like Enron we’re enjoying 20 percent and higher returns and those at the wheel — even in cases where the CEO and the board were akin to sitting behind the controls of a jet on autopilot — where showering themselves with obscene compensation for allegedly being brilliant captains of capitalism.

Before we start manning the barricades and revisiting the “99 Percent versus the 1 Percent” malarkey that powered the Occupy Wall Street Movement, many of us buy into the same mentality that PG&E did when just making a steady profit that may dip some years because of reinvesting in the company that is essentially a money machine isn’t good enough. They wanted to get richer faster.

We are all guilty of it. We buy our first house and we want what our parents surrounded us with when we were growing up and more. We forget the fact how long it took them to buy new drapes, new furniture, or a new car because we were either unaware of it or not around during the struggle. We want it all now. Delayed gratification is for losers especially in a world that has come to value the get rich quick hare over the plodding tortoise.

Remember when banks were only open from 10 a.m. to 3 p.m., Monday through Thursday and the as late as 6 p.m., on Fridays that were traditionally payday for most people? Banks were happy with high single digit profits. Loans were secured as much on character and trust that could be used to negate what a computer algorithm may tell you about what a set of financial information says about a person’s ability to repay a loan but tells you nothing about their commitment to do so. 

Money didn’t flow like water during a rapid snow melt. Now you simply whip out a debit, credit card, or smartphone and access it instantaneously. There’s nothing wrong with the tech or the ability to access your money 24-7. But back when you had to take advantage of certain windows to do so or even write a check, it seemed like many of us thought a little bit more about what we were doing with our money.

Investors who have been dumping on Apple also have underscored how our sense of value has migrated to questionable conclusions over the years.

One assertion is Apple’s alleged woes of essentially selling only 46.7 million i-Phones in a quarter compared to 46.5 million the previous quarter is somehow the sign of a company in decline. They are selling 15 million highly profitable phones a month yet that is considered the sign of a weak business.

And the possible reasons for that — market saturation and people keeping their devices linger — make some investors nervous.

It’s laughable given that Apple turns a consistent profit compared to some e-commerce companies that are judged not by their ability to make a profit but by their potential to do so meaning the more subscribers or units you land even if you lose money is how you are judged. Yes, you’ve got to spend money to make money and you don’t make money out of the gate, but there are companies that continue to burn through money non-stop the way a rocket burns through fuel and after years have failed to make a reasonable return or post consistent profits that are valued by investors more than concerns such as Ford Motor Co. and ConAgra Brands. It underscores how the risky shot at a quick buck is valued more these days than a steady more conservative return.

The fact people who have Apple devices are sold on them and holding onto them longer because there isn’t a new feature on the latest models they need or want enough to pry their fingers off their current i-Phone is considered a bad thing. It doesn’t matter that customers are still plugged into the Apple infrastructure allowing Apple to vacuum up tons of money via its percentage on the sale of apps. It doesn’t matter when they do upgrade, Apple customers are more likely than other smartphone users to not switch companies.

Granted there are those who strike it rich by investing in stock and other things with the mentality of venture capitalists. But if you look around there are a whole lot of people who have done just fine with their lives and they didn’t make enough money to own six homes, plunk down $25,000 a year on a vacation, or spend $1,100 apiece on dress shirts.

Wall Street has turned into 7-Elevens where people “invest” considerable change gaming for the big lottery payoff. A number of people do win modest amounts occasionally but for the most part their money is going into the pockets of others whether it is the state in the case of the lottery or highly compensated CEOs often of companies that fail to make a profit if they are investing.

What makes it all ironic is that many people who do strike it big — either with a $400 million lottery payoff or by needing to lease a part of Fort Knox to park their net worth from investing — aren’t exactly happy campers.

Nothing against wealth but when you pursue the quick buck that buck often has less value. Perhaps it is because if you do succeed with little effort or because there are so many bucks when you hit it big, the money carries less value.

One thing is for sure, those who are in anything for the long haul whether it is investing or life itself are not going to judge value of their investment or their life on just the events of one day.

When we appreciate real value, we tend to do well in the long haul whether it is with money or our lives.


This column is the opinion of executive editor, Dennis Wyatt, and does not necessarily represent the opinion of The Bulletin or Morris Newspaper Corp. of CA.  He can be contacted at or 209.249.3519.