Based upon how well both Google and Amazon are doing in the stock market the past couple of years, I’ve determined that much of the investment community is rigged. Either that, or it’s a form of legalized gambling controlled by a mob of very rich people who only work to get themselves richer and to hell with everyone else.
Hear me out on this. Let’s look at Apple and Google. Apple’s stock, despite a profit to earnings ratio that is utterly and ridiculously low, has been mostly paralyzed for more than a year, despite Carl Icahn’s $4B purchase of AAPL and the influence that brings on the market.
Apple is obviously a well run company and has been for many years, whether under co-founder Steve Jobs’ reign or that of current CEO Tim Cook. Every leg of Apple’s multi-legged business is solid. Mac, iPhone, iPad, Apple Stores, iTunes Mall. Everything makes money.
Additionally, Apple has a well-earned reputation for disrupting business unlike any other. The Mac disrupted the PC industry. The iPod disrupted the portable music industry. iTunes disrupted the entertainment and application industry. The iPhone disrupted the smartphone industry. The iPad disrupted both tablet and PC industries.
Alright, now compare that against Google and GOOG.
Google, despite spending tens of billions of dollars on research and development, and the ill advised purchase of a number of money-losing companies (which had to be jettisoned), all with a desire to disrupt, expand, and become diversified, looks more and more like Microsoft each day.
The search giant’s revenue and profit– well over 90-percent for each– comes from the same source it has always come from– advertising. Even in mobile advertising, for which Google has spent tens of billions of dollars on Motorola, patents, and Android, most of the revenue and profits come from Apple’s iOS devices.
Google is the ultimate one-trick pony company. Yet, the stock market thinks otherwise.
Put a simpler way, Google is being rewarded for sizzle but no steak. Apple is being punished for delivering both sizzle and steak. Does that even make sense? Google does not have a reputation or a history of upending industry markets but is being rewarded as if it has. On the other hand, Apple, which has a stellar reputation for growth, revenue, profits, and industry market disruptions, is being punished because of what it is.
One can only conclude that the stock market as we know it is run by rich charlatans as their own personal gambling casino. Otherwise, investors are idiots.