02-17-12 04:33 PM
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  1. conix67's Avatar
    Sure....Apple stock was about $50.00 in 1984.
    Are you joking or serious? I could never tell. In 1984, Apple stock was merely worth $3.8 and it wasn't until mid-2000 their stock price reached $50.
    02-14-12 03:49 PM
  2. dejanh's Avatar
    Where did families come in?

    And how are you uniquely positioned to comment about family ties across 3 continents? I think its a little offensive when you classify Americans as uncaring about family.

    What makes you think Indians care more about their family than Americans? Pre-conceived notions....
    While I agree that the original comment is a logical fallacy ( hoc ergo propter hoc or correlation proves causation) I would have to disagree on preconceived notions.

    North America breeds individuals and individualist culture. The whole society is based on consumerism built into its core and that is reflected through everything, including family relations. There is a huge driving force in North America behind ensuring that each individual grows up thinking that they are best off functioning and living as an individual, avoiding sharing, giving, long term relationships, attachment, etc. Everything revolves around "me" and instant gratification. This is inherently at odds with what a family stands for and what community building is all about. Further to this, because of the high living standard there is little need to band together as a community and function as a unit to get things done. Simply put, if one's life is pretty good on one's own, then there is no need for that one to band with others to raise their living standard.

    If you actually do some research into sociology, psychology, and psychiatry, you will find very hard research that shows these things to be facts, not opinions. I encourage you to do so. Maybe you will understand the world around you a bit better...of if you are too lazy to do that, tell me how many of your family members and your friends family members are around every week doing something as a community and how many of your neighbors do you actually know and socialize with on regular basis?

    Don't knock things you know nothing about. Even if you can single out experiences from other areas that show that there are issues of detachment and narcissistic type of individualism present, that still does nothing to refute very known facts about North America. If it makes you feel any better, UK, Germany, and a few other Northern European countries also have some of these issues, but not as bad as the cases present in North America.
    02-14-12 03:52 PM
  3. dejanh's Avatar
    The stock is falling ahead of OS 2.0 release. I thinks its a clear show of no support and expectations of failure. Come to think of it, I haven't seen any new advertising lately aside from those dudes playing music and they happen to have a Blackberry.

    RIM cannot survive if they don't change the PR and advertising. Period.

    ps. As we speak, the desktop software icon just popped up saying there's a new release!! Yippeee!!


    WHAT? Are you serious? Are you talking "OS" release or "Desktop Manager" release? Don't give me a heart-attack for no reason! Tell me! Which is it!!! Spill it!!!!
    Last edited by dejanh; 02-14-12 at 03:57 PM.
    02-14-12 03:54 PM
  4. kennyliu's Avatar
    It's a rejected theory, duh?
    Who says so? It's currently a dominant theory/hypothesis in Finance, with Behavioral Finance explaining some of smaller nuances. Duh.
    02-14-12 03:55 PM
  5. alnamvet68's Avatar
    Roman Empire was huge many centuries ago? Your point? Wait 30 years and RIM will be back up on its feet again?
    You must have taken risks and invested heavily in the stock market, as I have...you wouldn't understand.

    No comments...

    Again, if you haven't a risk taker mentality, you will be rendered speechless.
    02-14-12 04:00 PM
  6. kennyliu's Avatar
    On that note, markets are not efficient all the time. Just like any human endeavour they are inefficient and illogical. If they were totally efficient, people wouldn't be able to make money from undervalued or overvalued stock. Every stock would be stable at its intrinsic value.
    Nobody's talking about strong form efficiency here. As for the following:

    "If they were totally efficient, people wouldn't be able to make money from undervalued or overvalued stock. Every stock would be stable at its intrinsic value."

    That's not what market efficiency claims. There will always be actors who use new or unrevealed info to their benefit (but they can't do that consistently). But it's due to their action that the market/price always goes back to the equilibrium and equates the intrinsic value of the firm (value given all available info).
    02-14-12 04:01 PM
  7. kennyliu's Avatar
    You must have taken risks and invested heavily in the stock market, as I have...you wouldn't understand.

    Again, if you haven't a risk taker mentality, you will be rendered speechless.
    I have invested in stock. But how is risk relevant here? Are we not talking about the price as a reflection of the intrinsic value?
    02-14-12 04:02 PM
  8. alnamvet68's Avatar
    Are you joking or serious? I could never tell. In 1984, Apple stock was merely worth $3.8 and it wasn't until mid-2000 their stock price reached $50.
    Mere decimal point misplacement; and the stock could be had for about $7.00 in 2002.
    02-14-12 04:03 PM
  9. conix67's Avatar
    Mere decimal point misplacement; and the stock could be had for about $7.00 in 2002.
    I still don't get it. What's the relevance of Apple's stock price of $7 in 2002? Are you comparing that with RIM's current price?
    02-14-12 04:09 PM
  10. hootyhoo's Avatar
    I still don't get it. What's the relevance of Apple's stock price of $7 in 2002? Are you comparing that with RIM's current price?
    Maybe he's trying to say that RIMM stock will soon be trading that low.
    02-14-12 04:17 PM
  11. sam_b77's Avatar
    While I agree that the original comment is a logical fallacy ( hoc ergo propter hoc or correlation proves causation) I would have to disagree on preconceived notions.

    North America breeds individuals and individualist culture. The whole society is based on consumerism built into its core and that is reflected through everything, including family relations. There is a huge driving force in North America behind ensuring that each individual grows up thinking that they are best off functioning and living as an individual, avoiding sharing, giving, long term relationships, attachment, etc. Everything revolves around "me" and instant gratification. This is inherently at odds with what a family stands for and what community building is all about. Further to this, because of the high living standard there is little need to band together as a community and function as a unit to get things done. Simply put, if one's life is pretty good on one's own, then there is no need for that one to band with others to raise their living standard.

    If you actually do some research into sociology, psychology, and psychiatry, you will find very hard research that shows these things to be facts, not opinions. I encourage you to do so. Maybe you will understand the world around you a bit better...of if you are too lazy to do that, tell me how many of your family members and your friends family members are around every week doing something as a community and how many of your neighbors do you actually know and socialize with on regular basis?

    Don't knock things you know nothing about. Even if you can single out experiences from other areas that show that there are issues of detachment and narcissistic type of individualism present, that still does nothing to refute very known facts ab out North America. If it makes you feel any better, UK, Germany, and a few other Northern European countries also have some of these issues, but not as bad as the cases present in North America.
    1) This is completely off topic.
    2) I'm not a North American
    3) My family and extended family is around me 24x7
    4) I know more about sociology, history and the evolution of human society than you might think.
    5) Your entire post is an example of pre-conceived notions in that you believed that I dont know about these topics or am generally ignorant towards the ways of the world.
    6) While every country has cultural differences which tend to work for them, there is no need to insult anyone based on their country's cultural and social setup.
    7) The poster I was replying to was downright insulting and offensive towards Americans as a group. I'm not an American and understand that the American society is more individualistic than other societies, there is still no need to be uncivil about it
    8) And finally societies which you might think to be less individualistic might be more than you think. The said family ties are due to lack of resources and a need to share them as a group. But you mentioned this aspect in your post so I will give you the benefit of doubt which you did not grant me and assume that you are not a ignoramus.

    Now back to our regular programming of RIM vs Apple.
    Last edited by sam_b77; 02-14-12 at 04:42 PM.
    02-14-12 04:35 PM
  12. canuckvoip's Avatar
    [/B]

    WHAT? Are you serious? Are you talking "OS" release or "Desktop Manager" release? Don't give me a heart-attack for no reason! Tell me! Which is it!!! Spill it!!!!
    Desktop Manager. Just downloaded and installed ver 7. Checked for PB updates, nada.
    But... Here we go... maybe this Friday after all?
    02-14-12 04:37 PM
  13. sam_b77's Avatar
    Nobody's talking about strong form efficiency here. As for the following:

    "If they were totally efficient, people wouldn't be able to make money from undervalued or overvalued stock. Every stock would be stable at its intrinsic value."

    That's not what market efficiency claims. There will always be actors who use new or unrevealed info to their benefit (but they can't do that consistently). But it's due to their action that the market/price always goes back to the equilibrium and equates the intrinsic value of the firm (value given all available info).
    But the perfect market hypothesis dictates that any information available is known instantly and the stock price determines the correct value at any given time.

    If the information is not known to the market but is out there then the market is speculating in which case its not efficient. Take one or the other.

    By the way the perfect market hypothesis and efficient market theories have been debunked in practice. Its the playground of economists and professors but not of traders.
    02-14-12 04:39 PM
  14. hootyhoo's Avatar
    1) This is completely off topic.
    2) I'm not a North American
    3) My family and extended family is around me 24x7
    4) I know more about sociology, history and the evolution of human society than you might think.
    5) Your entire post is an example of pre-conceived notions in that you believed that I dont know about this topics or am generally ignorant towards the ways of the world.
    6) While every country has cultural differences which tend to work for them, there is no need to insult anyone based on their country's cultural and social setup.
    7) The poster I was replying to was downright insulting and offensive towards Americans as a group. I'm not an American and understand that the American society is more individualistic than other societies, there is still no need to be uncivil about ti.
    8) And finally societies which you might think to be less individualistic might be more than you think. The said family ties are due to lack of resources and a need to share them as a group. But you mentioned this aspect in your post so I will give you then benefit of doubt which you did not grant me and assume that you are not a ignoramus.

    Now back to our regular programming of RIM vs Apple.

    Great post!!!!!! While I don't always agree with you on some things, I'd sit and have a beer with you any day.
    sam_b77 likes this.
    02-14-12 04:41 PM
  15. palmless's Avatar
    I will weigh in and say the stock price does NOT say it all.

    It reflects the market's expectations.

    We can get confused when we see that the market SOMETIMES gets it wrong, and that causes us to believe that the market ALWAYS gets it wrong (or right).

    We sometimes ignore the fact that the market is reasonably efficient, and say things like "Well, AAPL is high, but Cisco was high, and the market was wrong" or "Well, RIMM is in the gutter, but XYZ was in the gutter and the market was wrong". The exception does not prove the rule.

    AAPL is traded at the value of it's expected future cash flows. Once you take out excess cash, AAPL is trading at a single digit P/E, which is normally reserved for troubled tech companies (like RIMM). If AAPL had Amazon's P/E, a share of AAPL would cost around $4,500. With a P/E of ten, and a discount rate of say 5%, investors are confident that AAPL will deliver stable earnings for eleven quarters, or growing earnings for some shorter period of time. A VERY conservative bet, and thus, we are beginning to understand that $500 is a very conservative stock price for AAPL.

    RIMM is traded at the value of it's expected future cash flows. The investors have seen this game before, seen the "Oh, we missed this quarter and this quarter and this quarter and this quarter and this quarter and our last ten products have bombed, but we have a good one coming late this year and have I mentioned how many units we sell in Bombay?". They've seen it. They know how it ends. Therefore, the stock trades very low, at it's expected future cash flows.

    When there is positive news, lately limited to takeover rumors, the stock goes up. When there is negative news (anything about financial performance, product, or statements by anyone associated with RIMM), the market goes down, as the expectation of future cash flows go down.

    I think we can agree that the next two quarterly reports will be ugly based on revenue declines, unit declines, margin declines, cash evaporation, earnings, etc. Worse, they will probably be accompanied by some "Stay the course", "Be Bold", "BBX/10 will be awesome in six months" verbiage that will make the facts look a little worse than they would in isolation.

    The stock will pay the price.
    Last edited by Palmless; 02-14-12 at 04:46 PM.
    02-14-12 04:42 PM
  16. sam_b77's Avatar
    Great post!!!!!! While I don't always agree with you on some things, I'd sit and have a beer with you any day.
    Anytime you are in India give me a holler and we'll meet at the local for some steak and beer.
    I think a lot of us have a lot more in common if we leave out the RIM vs Apple vs Android topic. On that one we have swords drawn.
    02-14-12 04:51 PM
  17. kennyliu's Avatar

    1)But the perfect market hypothesis dictates that any information available is known instantly and the stock price determines the correct value at any given time.

    2) If the information is not known to the market but is out there then the market is speculating in which case its not efficient. Take one or the other.

    3)_By the way the perfect market hypothesis and efficient market theories have been debunked in practice. Its the playground of economists and professors but not of traders.
    1) Wrong, you can't have an efficient market without someone making instanteneous profits and attracting other investors, which in its turn, leads the market back to the equilibrium.

    2) See above. You don't have to take one or the other. There are always actors new info is known to first.

    3) As far as I remember, nobody has debunked the hypothesis to the extent that that debunking is accepted by the mainstream Finance people.. There are theories that COMPLEMENT the hypothesis. Also, AFAIK, Finance can loosely be described as a branch of Economics. No?

    As for traders/practitioners, if what you are saying is right, then there should be many more traders (not a couple outliers) who consistently make economic/excess profit, right? But it's mostly a zero-sum game. Traders gain if other traders lose.

    So practitioners/managers can live in their illusions, which, I have to say, are convenient for them as they make money by attracting investors.

    Before you answer, note that I am not talking about the STRONG form market efficiency.

    At the same time, I am not saying that there is no place for some inefficiency due to certain irrationality of market actors. But we are talking about the company whose shares have been low for a long time. So if it was undervalued significantly, it would have been devoured by other companies by now. It may very well be undervalued now, but not to the extent that it makes the board or other companies bother about going over all the legal and transaction hoopla to sell or significantly change it's operation structure.
    Last edited by kennyliu; 02-14-12 at 06:13 PM.
    02-14-12 06:06 PM
  18. kennyliu's Avatar
    I will weigh in and say the stock price does NOT say it all.

    It reflects the market's expectations.

    We can get confused when we see that the market SOMETIMES gets it wrong, and that causes us to believe that the market ALWAYS gets it wrong (or right).

    We sometimes ignore the fact that the market is reasonably efficient, and say things like "Well, AAPL is high, but Cisco was high, and the market was wrong" or "Well, RIMM is in the gutter, but XYZ was in the gutter and the market was wrong". The exception does not prove the rule.

    AAPL is traded at the value of it's expected future cash flows. Once you take out excess cash, AAPL is trading at a single digit P/E, which is normally reserved for troubled tech companies (like RIMM). If AAPL had Amazon's P/E, a share of AAPL would cost around $4,500. With a P/E of ten, and a discount rate of say 5%, investors are confident that AAPL will deliver stable earnings for eleven quarters, or growing earnings for some shorter period of time. A VERY conservative bet, and thus, we are beginning to understand that $500 is a very conservative stock price for AAPL.

    RIMM is traded at the value of it's expected future cash flows. The investors have seen this game before, seen the "Oh, we missed this quarter and this quarter and this quarter and this quarter and this quarter and our last ten products have bombed, but we have a good one coming late this year and have I mentioned how many units we sell in Bombay?". They've seen it. They know how it ends. Therefore, the stock trades very low, at it's expected future cash flows.

    When there is positive news, lately limited to takeover rumors, the stock goes up. When there is negative news (anything about financial performance, product, or statements by anyone associated with RIMM), the market goes down, as the expectation of future cash flows go down.

    I think we can agree that the next two quarterly reports will be ugly based on revenue declines, unit declines, margin declines, cash evaporation, earnings, etc. Worse, they will probably be accompanied by some "Stay the course", "Be Bold", "BBX/10 will be awesome in six months" verbiage that will make the facts look a little worse than they would in isolation.

    The stock will pay the price.
    Absolutely correct. But what other people suggest is that expectations are unjustifiable and unreasonable given all available information, which is not the case.
    02-14-12 06:11 PM
  19. dejanh's Avatar
    1) This is completely off topic.
    2) I'm not a North American
    3) My family and extended family is around me 24x7
    4) I know more about sociology, history and the evolution of human society than you might think.
    5) Your entire post is an example of pre-conceived notions in that you believed that I dont know about these topics or am generally ignorant towards the ways of the world.
    6) While every country has cultural differences which tend to work for them, there is no need to insult anyone based on their country's cultural and social setup.
    7) The poster I was replying to was downright insulting and offensive towards Americans as a group. I'm not an American and understand that the American society is more individualistic than other societies, there is still no need to be uncivil about it
    8) And finally societies which you might think to be less individualistic might be more than you think. The said family ties are due to lack of resources and a need to share them as a group. But you mentioned this aspect in your post so I will give you the benefit of doubt which you did not grant me and assume that you are not a ignoramus.

    Now back to our regular programming of RIM vs Apple.
    1. Yes it is, so was your post
    2. Thank you for letting me know. Unfortunately just because somebody tags their location here that does not mean much.
    3. I believe that since I now know that you are from India. I can also say that most Indian families are like this because I interact with them every day. You see, observation Culturally, you are like that. It is therefore typical of your culture. There is nothing bad about that, it's just what it is.
    4. Don't be offended that I said you know nothing about the topic. You brought it upon yourself as a result of making a broad statement about preconceived notions. There are no preconceived notions on these matters. They are well studied and well known. Fact that North American society is largely a "set" of individuals is a fact. It is also a fact that they have very low emphasis on family ties throughout their life. See, unlike you I actually explained the cause behind that (they are not born with it just to be crystal clear), as opposed to just saying, and I paraphrase "I know, and you should be quiet because you don't know what I do or don't know".
    5. Defending your argument by repeating the same thing that established your original argument does not make your argument stronger. Also, I did not imply that you are ignorant to the ways of the world, just on the particular topic. Besides, I do not even understand why this bothers you so much. Cultural differences do exist and are very strongly delineated. This was even discussed by very famous psychologists and is effectively defined as a "personality" of a society. If you want more reading, there is actually a good definition for "culture" to be found here http://nptel.iitm.ac.in/courses/1101...le%207l-35.pdf. Just do a search for "personality of a society".
    6. Nobody was being insulted, unless some Americans do not like being told that they are not perfect (which some may not like). I do not understand why you are making this a personal issue for yourself. I've had some very unpleasant experiences with cultural tolerances, nationalism, and racism myself but I'm not afraid to talk about it.
    7. Actually, no he was not. He simply stated that Americans (I would correct him on that and say North Americans) are generally not family or communally inclined which is the de-facto truth. There is no grey area there. His premise and conclusion did not follow though.
    8. Not everything in life is so "indeterminate" as you think. Individuals exist everywhere, and gradients do too, but a particular culture as a whole is a mirror reflection of the general belief and value system of a given group. That also is a fact. There is nothing there to be interpreted. Family ties are much more than just a lack of resources.

    Anyway, you actually seem like you are pretty bright, but maybe a bit naive in wanting to have this utter sense of equality and political correctness around everything. There is no need for that. People need to see things for what they are if they are ever to progress. I will leave it up to you to define "progress" in this case as I do not have one definition or one path that would define it precisely.

    Last edited by dejanh; 02-14-12 at 06:26 PM.
    alnamvet68 likes this.
    02-14-12 06:21 PM
  20. conix67's Avatar
    As for traders/practitioners, if what you are saying is right, then there should be many more traders (not a couple outliers) who consistently make economic/excess profit, right? But it's mostly a zero-sum game. Traders gain if other traders lose.
    Not quite true. When the whole market goes up, everyone wins.

    To me the whole stock market is a big scam but for some reason the world economy is driven by it.
    02-14-12 07:04 PM
  21. kennyliu's Avatar
    OK, I didn't have time before, but let me summarize this thread now without going into theory to much:

    There are people in this thread who claim that the stock price does not reflect the true value of the company (given all the information/expectations) and RIM is undervalued way too much (current price < true value).

    In other words, they claim they know better than the market with all the investors, both individual and institutional. This is a very strong claim. I would call it simply nonsense.

    If the above was true and you, guys, somehow knew RIM was significantly undervalued, you most likely wouldn't be wasting your time here on this forum but would be flying your own private jet to a corporate meeting or some exotic place to rest after working very hard making billions using your unique ability to know better than everyone else
    02-14-12 07:09 PM
  22. kennyliu's Avatar
    Not quite true. When the whole market goes up, everyone wins.

    To me the whole stock market is a big scam but for some reason the world economy is driven by it.
    Sorry, but the market averages do not go up because of certain financial market agents' (traders') actions. This is not what the theory is about. There can still be overall growth, but excess/economic profits are only possible if there is economic loss.

    This is too technical and nuanced. Better see my post above.
    Last edited by kennyliu; 02-14-12 at 07:16 PM.
    02-14-12 07:11 PM
  23. swyost's Avatar
    The bad news is the fact that GSA has authorized Android and iPhone purchases. As GSA contracting is used as a template for other federal agencies, this is a big deal to RIM. Reports are also out that a couple major corporations are dumping RIM.

    With respect to Apple's share price, it is over inflated. The same goes for Google. I am surprised there haven't been any stock splits or other efforts to control the prices.
    02-14-12 07:15 PM
  24. ayekon's Avatar
    While I agree that the original comment is a logical fallacy ( hoc ergo propter hoc or correlation proves causation) I would have to disagree on preconceived notions.

    North America breeds individuals and individualist culture. The whole society is based on consumerism built into its core and that is reflected through everything, including family relations. There is a huge driving force in North America behind ensuring that each individual grows up thinking that they are best off functioning and living as an individual, avoiding sharing, giving, long term relationships, attachment, etc. Everything revolves around "me" and instant gratification. This is inherently at odds with what a family stands for and what community building is all about. Further to this, because of the high living standard there is little need to band together as a community and function as a unit to get things done. Simply put, if one's life is pretty good on one's own, then there is no need for that one to band with others to raise their living standard.

    If you actually do some research into sociology, psychology, and psychiatry, you will find very hard research that shows these things to be facts, not opinions. I encourage you to do so. Maybe you will understand the world around you a bit better...of if you are too lazy to do that, tell me how many of your family members and your friends family members are around every week doing something as a community and how many of your neighbors do you actually know and socialize with on regular basis?

    Don't knock things you know nothing about. Even if you can single out experiences from other areas that show that there are issues of detachment and narcissistic type of individualism present, that still does nothing to refute very known facts about North America. If it makes you feel any better, UK, Germany, and a few other Northern European countries also have some of these issues, but not as bad as the cases present in North America.
    lol... wow...
    02-14-12 07:21 PM
  25. conix67's Avatar
    Sorry, but the market averages do not go up because of certain financial market agents' (traders') actions. This is not what the theory is about. There can still be overall growth, but excess/economic profits are only possible if there is economic loss.

    This is too technical and nuanced. Better see my post above.
    That is why I say it's a big scam. The growth of economy is heavily influenced by several factors, including growth in stock market index. Last few decades, the growth has been driven by factors not normally present in healthy economy.
    02-14-12 07:21 PM
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