Why I Just Bought A BlackBerry

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In the hunt for returns in the jungle of investing we rarely talk about “quality of life”, but it should be remembered that the whole reason for investing is precisely that; to preserve and improve one’s quality of life, either through retirement savings, covering and planning for education or making purchasing a house feasible. That’s what this is all for.

So it’s easy then to get lost in the mechanics of investing. At the charts (see #MarketGlance) the news and the conferences:

https://twitter.com/Walker_Report/status/515164444604006400

This tends to create a disconnect between how we experience the world and how we want our investments to work. For instance I am a big believer in Apple products. (AAPL). I like their phones and computers, I’m in their ecosystem, and as an investor I am impressed at their success as a company. But as a user of an iPhone I’ve started to wonder just how much time I waste under the pretence  of having a highly capable phone.

Apple Stock over the last ten years
Apple Stock over the last ten years

When the iPhone first came to Canada I was struck by the idea that I could look up directions easily, check the internet quickly for information and have access to my emails. When first introduced the iPhone was a tool of productivity. Since then the smart phone market has been flooded and “feature creep” is definitely a term I would use to describe what many of these phones can now do. Meanwhile productivity has taken a backseat to a host of other competing and primarily entertaining functions. In short, I was tired of wasting time on my phone doing nothing.

And along came Blackberry offering, in some ways, a phone that promises to do less fun stuff, and do more work stuff. And while I had shunned Blackberry for years, based largely on my own terrible experience with the older models and their tiny screens, the new Passport seemed to offer me not simply a useful phone for doing work, but also terrible one to watch Netflix on. Because why am I watching Netflix on my phone in the first place?

Are angry birds really the best use of your time on a $1000 phone?
Are angry birds really the best use of your time on a $1000 phone?

We live in an age of giant flat TVs with instant movie watching capabilities, but for reasons beyond me I’ve taken to watching stuff on my phone. So while I love Apple, and believe that they have a great company, I’m hoping that I can improve my quality of life by degrading my phone experience somewhat.

Maybe there is hope for Blackberry yet.

Recommended Read: The End of Absence: What We’ve Lost in a World of Connection by Michael Harris

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Why Apple is a Good Lesson on Investing

Over the last few years some elements of the stock market have seemed fairly crazy. Tech stocks, often belonging to social networking sites like Twitter, have had an unbelievable run. Meanwhile Apple Computers (a favourite of mine) have frequently been heavily criticized for declining revenue growth and slowing sales numbers. Business commentators like to point to the growth in Google’s Android phone platform and its large share of the mobile phone market as proof that Apple’s days as a global leader are past.

However with Apple’s most recent earnings report out there are some important things to take note of. The chief reason that we invest in companies is because they make money, and Apple is currently one of the most profitable companies around. How profitable? Take these statistics published today in Slate.com.

If Apple’s iPhone was it’s own company it would be larger than 474 companies on the S&P 500 index and would have revenues in excess of Amazon, Coca-Cola, McDonalds, Google and E-bay. iphone.png.CROP.promovar-mediumlargeThat’s just its phone division. The iPad, whose sales numbers are definitely plateauing if not declining is still a valuable business netting $5.9 billion in revenues, greater than Facebook, Twitter, Yahoo, Groupon, and Tesla combined. ipad_1.png.CROP.promovar-mediumlargeMac Computers, which earned less than the iPad division, still garnered an impressive $5.5 billion. Even the iPod, now almost totally forgotten in the midst of smartphones and iPads still earned an impressive $442 million, 77% than Twitter’s $250 million in quarterly revenues.

Apple’s stock has periodically taken a licking, but has been beating its way back to its previous high (partly due to a recent stock split and dividends periodically being paid), but its story is an important cautionary tale.

Apple Stock Price
Apple Share Price History

Good investing comes from choosing companies that produce revenue and retain growth potential, in other words focusing on the fundamentals of investing. Despite naysayers, that’s exactly the kind of company Apple has been. So why does Apple get so much negative attention? Because predicting the fall of a Goliath is exactly the kind of thing that makes news. Whether it’s true or not is irrelevant in the news cycle, but it is a source of bad investor advice, and should serve as a cautionary tale to investors considering taking financial advice from business news.